Next G.O. Bonds Package 2027?

[Rover]

I would love to see my neighborhood streets repaved and the drainage improved. A closer public library and a city park. However, I’m not holding my breath as I’m sure some trendy watchadoodle for downtown or NW OKC will take precedence. My neighborhood was built in 1984 and I have to go to Del City, Moore or Midwest City to enjoy a good park or the library. Yet I pay OKC MAPS taxes and see no benefit from it.

What neighborhood do you live in? What’s your nearest park?

[Dob Hooligan]

I would love to see my neighborhood streets repaved and the drainage improved. A closer public library and a city park. However, I’m not holding my breath as I’m sure some trendy watchadoodle for downtown or NW OKC will take precedence. My neighborhood was built in 1984 and I have to go to Del City, Moore or Midwest City to enjoy a good park or the library. Yet I pay OKC MAPS taxes and see no benefit from it.

I recall the late 1970s-80s era was when developers were installing inferior streets, drainage, signage, etc, and the City of Oklahoma City stopped taking over ownership and maintenance of those that weren't built to code. Seems like a friend in The Meadows section of Summerfield was telling about his travails.

[Bellaboo]

I have to go to Del City, Moore or Midwest City to enjoy a good park or the library. Yet I pay OKC MAPS taxes and see no benefit from it.

Scissortail Park has it all, and isn't that far from your referenced cities ???

[Laramie]

Scissortail Park has it all, and isn't that far from your referenced cities ???

He could also contact his councilman about any concerns.

[warreng88]

I would love to see my neighborhood streets repaved and the drainage improved. A closer public library and a city park. However, I’m not holding my breath as I’m sure some trendy watchadoodle for downtown or NW OKC will take precedence. My neighborhood was built in 1984 and I have to go to Del City, Moore or Midwest City to enjoy a good park or the library. Yet I pay OKC MAPS taxes and see no benefit from it.

Contact your city council person. They are the ones who work with the city to push for more money for their ward. We made a big push for better sidewalks a block from our house ten years ago and they are going in as part of the 2017 GO Bond. It takes time, but that's the only way to do it.

[Laramie]

Fed slashes interest rates by a half point:

Calling on all of our Economic gurus and those in-the-know out there--how this recent move will positively affect OKC on borrowing money to build the proposed $900 million downtown arena (repaid with future MAPS 4 extension vote funds) on the 4 square block site of the Prairie Surf Media Studios--Old former Cox & Myriad Convention Center site.

$78 million MAPS 4 (Before extension)
$50 million The Professional Basketball Club (PBC) LLC
$772 million MAPS 4 (72 month extension vote)

Is this a game changer?

.

[warreng88]

Fed slashes interest rates by a half point:

Calling on all of our Economic gurus and those in-the-know out there--how this recent move will positively affect OKC on borrowing money to build the proposed $900 million downtown arena (repaid with future MAPS 4 extension vote funds) on the 4 square block site of the Prairie Surf Media Studios--Old former Cox & Myriad Convention Center site.

$78 million MAPS 4 (Before extension)
$50 million The Professional Basketball Club (PBC) LLC
$772 million MAPS 4 (72 month extension vote)

Is this a game changer?

.

I don't think this helps anything on the arena side of it. I would think, if anything, it would hurt because the money the city collects sits in an account until it is used for projects. Those accounts are interest bearing. With the fed cutting rates, the rate of the account goes down as well so there isn't as much coming in off of it.

I might be completely off on this, but that is how I would see it. I would be happy to be told I am wrong.

[Laramie]

I don't think this helps anything on the arena side of it. I would think, if anything, it would hurt because the money the city collects sits in an account until it is used for projects. Those accounts are interest bearing. With the fed cutting rates, the rate of the account goes down as well so there isn't as much coming in off of it.

I might be completely off on this, but that is how I would see it. I would be happy to be told I am wrong.

So this wouldn't help the City shop for a lower interest rate to fund the $772 million or more the City would bear to fund the arena for 72 months.

The $50 million the ownership group chipped in will probably pay for the demolition & prep of the PSM site (bid process); the $78 million should partially pay for the architectural and design fees for the new venue.

Will OKC need to request more money in the 2025 GO Bonds' next election on top of the funds needed for the Devon Park and Riversport Rapids facilities for LA28 Olympics.

[Urbanized]

I don't think this helps anything on the arena side of it. I would think, if anything, it would hurt because the money the city collects sits in an account until it is used for projects. Those accounts are interest bearing. With the fed cutting rates, the rate of the account goes down as well so there isn't as much coming in off of it.

I might be completely off on this, but that is how I would see it. I would be happy to be told I am wrong.

This erroneously assumes that the arena tax will be collected before construction begins, while in actuality that tax does not begin accumulating until the MAPS 4 tax expires in 2028. Meaning the arena is likely to be largely completed before the arena tax even begins collection. Basically all of the construction expense (EXCEPT for the redirected MAPS 4 money and the team ownership's contribution) will be fronted via borrowed funds. So yeah, the lower the interest rates the better, from both a City and a taxpayer standpoint.

By the way, the inclusion of borrowed funds is why this is not characterized as a MAPS program, as MAPS projects have historically been 100% debt-free. People are forgetting that part. The interest on hundreds of millions of dollars - even if paid off within a few short years once the tax is collected - will be quite substantial.

[Laramie]

Following the bigger rate cut, "we are skeptical that the Fed will want to deliver a hawkish surprise", Bank of America economists said. The brokerage expects another 125 bps of cuts in 2025 to bring the terminal rate to 2.75%-3.00%, from the current federal funds target rate of 4.75%-5.00%.--Reuters

[bison34]

Borrowing rates won't drop nearly as quickly as savings rates will. High-yield savings accounts are likely going to be cut in half by next year, yet loan rates may not go down 1% overall.

[warreng88]

This erroneously assumes that the arena tax will be collected before construction begins, while in actuality that tax does not begin accumulating until the MAPS 4 tax expires in 2028. Meaning the arena is likely to be largely completed before the arena tax even begins collection. Basically all of the construction expense (EXCEPT for the redirected MAPS 4 money and the team ownership's contribution) will be fronted via borrowed funds. So yeah, the lower the interest rates the better, from both a City and a taxpayer standpoint.

By the way, the inclusion of borrowed funds is why this is not characterized as a MAPS program, as MAPS projects have historically been 100% debt-free. People are forgetting that part. The interest on hundreds of millions of dollars - even if paid off within a few short years once the tax is collected - will be quite substantial.

Awe sh!t, I didn't think about the borrowing part. Thanks for the clarification. I was thinking about it from a tax collection stand point from MAPS, so of course it helps. With the 1/2% cut this week WSJP is down to 8.00% and there is an expected 0.25-0.50% cut by the end of the year and then at least 1.00% next year.

I am not sure how the lending for something of this size would work but if it is floating (construction loans usually are) then the interest on the loan would be reducing as rates do. If it is fixed, the rate would stay the same regardless of what WSJP does. This is one of those rare instances that it makes sense to have a floating rate versus fixed for the time being.

[Rover]

This erroneously assumes that the arena tax will be collected before construction begins, while in actuality that tax does not begin accumulating until the MAPS 4 tax expires in 2028. Meaning the arena is likely to be largely completed before the arena tax even begins collection. Basically all of the construction expense (EXCEPT for the redirected MAPS 4 money and the team ownership's contribution) will be fronted via borrowed funds. So yeah, the lower the interest rates the better, from both a City and a taxpayer standpoint.

By the way, the inclusion of borrowed funds is why this is not characterized as a MAPS program, as MAPS projects have historically been 100% debt-free. People are forgetting that part. The interest on hundreds of millions of dollars - even if paid off within a few short years once the tax is collected - will be quite substantial.

It will be partially offset by paying certain construction costs early at lower costs than starting later. The issue is likely the interest rate paid minus inflation rate. Not that the net isn't real money, it just isn't the whole story.