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The city of Hannibal is projecting it will pay off the $1.7 million Stardust-Munger-Diamond TIF/TDD redevelopment project bonds far sooner than expected. The announcement was made earlier this week by Doug Warren, Hannibal’s director of finance.
“If revenue projections continue to hold over the next 14 months, final outstanding debt for this district should be retired in 2013, which is 10 years ahead of the target date stated in the original bond documents,” he said.
According to Warren, paying off the bonds will mean approximately $500,000 in additional revenue for the city.
“I feel good about that number unless there is another economic meltdown,” he said.
The only revenue that the city would not see initially from within the Stardust-Munger-Diamond Tax Increment Financing (TIF) redevelopment district, which includes the Huck Finn and River Bend shopping centers plus Lowe’s, is that generated by the five-eighths Transportation Development District (TDD) sales tax.
“That tax goes sunset when the (TDD) bonds are paid,” said Warren, noting that the TDD portion of the area does not include the Huck Finn Shopping Center.
The bonds were recently given a rating of A- by Fitch Ratings, which Warren says is significant.
“Fitch’s A- rating is considered ‘upper medium investment grade’ for revenue bonds. The city is very pleased with this rating. Additionally, they have rated the Hannibal outlook as stable,” said the finance director, explaining that when bond revaluations are conducted the rating agency looks at items such as payment history, reserves, sales track record, the demographics and census data as well as the financial strength of the stores in the shopping districts and the financial condition of the city.
The reason the projected bond payoff is ahead of schedule is all about the revenue that’s being generated in the district.
“Pledged revenues outperformed projections through the recent economic contraction, despite some degree of volatility,” he said. “Revenues were up approximately 36 percent year-over-year in 2009, before declining 9 percent in 2010. The increase was partially attributable to the 2008 opening of Lowe’s within the district.”
The city of Hannibal is projecting it will pay off the $1.7 million Stardust-Munger-Diamond TIF/TDD redevelopment project bonds far sooner than expected. The announcement was made earlier this week by Doug Warren, Hannibal’s director of finance.
“If revenue projections continue to hold over the next 14 months, final outstanding debt for this district should be retired in 2013, which is 10 years ahead of the target date stated in the original bond documents,” he said.
According to Warren, paying off the bonds will mean approximately $500,000 in additional revenue for the city.
“I feel good about that number unless there is another economic meltdown,” he said.
The only revenue that the city would not see initially from within the Stardust-Munger-Diamond Tax Increment Financing (TIF) redevelopment district, which includes the Huck Finn and River Bend shopping centers plus Lowe’s, is that generated by the five-eighths Transportation Development District (TDD) sales tax.
“That tax goes sunset when the (TDD) bonds are paid,” said Warren, noting that the TDD portion of the area does not include the Huck Finn Shopping Center.
The bonds were recently given a rating of A- by Fitch Ratings, which Warren says is significant.
“Fitch’s A- rating is considered ‘upper medium investment grade’ for revenue bonds. The city is very pleased with this rating. Additionally, they have rated the Hannibal outlook as stable,” said the finance director, explaining that when bond revaluations are conducted the rating agency looks at items such as payment history, reserves, sales track record, the demographics and census data as well as the financial strength of the stores in the shopping districts and the financial condition of the city.
The reason the projected bond payoff is ahead of schedule is all about the revenue that’s being generated in the district.
“Pledged revenues outperformed projections through the recent economic contraction, despite some degree of volatility,” he said. “Revenues were up approximately 36 percent year-over-year in 2009, before declining 9 percent in 2010. The increase was partially attributable to the 2008 opening of Lowe’s within the district.”
