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December 02, 2008

Orlando projects face bond troubles

More credit crunch fallout: Orlando has "postponed indefinitely" plans to sell bonds to renovate and build sports and arts facilities, thanks to both soaring interest rates and gloomy forecasts for the tourist taxes being counted on to help pay them off. "Just as our finance team was starting to meet, the financial markets blew up," Orlando CFO Rebecca Sutton told the Orlando Sentinel.

As of now, the $175 million renovation of the Citrus Bowl is planned to start in 2010 with completion the following year, but could be delayed further. Construction of a $425 million performing arts center is supposedly going ahead with short-term debt, in the hopes that the city can refinance later, which sounds suspiciously like what got us in this mess in the first place. Financing for the Magic's new $480 million arena is apparently mostly complete, so that should open as scheduled in 2010 - though the Sentinel reports that "tremors in the financial markets ... caused a four-month delay and a higher-than-expected interest rate," which means the city will end up with higher annual costs.

Though none of this is exactly happy news, there is a silver lining here, which is that if the Citrus Bowl project is scrapped, Orlando will have whatever remains of its hotel taxes left to spend on something more immediately useful than a shinier football stadium. Unless, of course, it blows it all trying to refinance that arts center debt.

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