At the time of this post, no contact has been received from any Council Member, VBED, VBDA or City Staff.
Follow-up email sent May 24, 2022
Dear Mayor Dyer and City Council Members,
I wanted to send this follow up email to confirm someone in the City is actively working on providing answers to the questions submitted last week. To date, we haven’t received any reply to the request. Excluding a blank email from Council Member Wilson, which I took to be a notification that she can’t discuss this issue due to her conflict of interest.
The community is aware that this 2nd round of Pass-Through Bonds was approved on consent with a 7-0 vote (2 COI, 2 Not Present), however, answers to the questions would go a long way to clearing up confusion that may be present in the community on this subject.
I assume the VBED department would be the ones to answer and if so, maybe Mr. Adams can send me the point of contact. I will be happy to follow up with them rather than reply via these large distribution emails.
Thank you for consideration and action,
Todd Solomon
Shore Drive Community Coalition President
Original email request sent May 17, 2022
From: Todd Solomon [mailto:todd@sdcc.info]
Sent: Tuesday, May 17, 2022 1:20 PM
Subject: City Council Agenda – May 17, 2022 Item J(7) – Resolution to Approve $164mil Bond for WCCB
Importance: High
Dear Mayor Dyer and City Council Members,
I am passing on some concerns and questions that have been raised by the Shore Drive community regarding today’s upcoming agenda item J(7) -Resolution to APPROVE the issuance of Residential Care Facility Revenue Bonds up to $164-Million re Westminster-Canterbury on Chesapeake Bay.
We would greatly appreciate replies to the items below to help us better understand the details behind this resolution request.
- Will WCCB be exempt from property taxes or will they still be required to pay taxes during the bond period? It is my understanding that with Industrial Revenue Bonds/Passive Activity Bonds (IRB/PAB), the City becomes the deed holder until the bond is paid off. Bonds of this type usually exempt the developer from property taxes. WCCCB has stated it needs no help with this project, waving property taxes would be considered help.
- What are the VBDA’s rates/structure and what are the fees associated with this bond issuance? Most municipalities charge a fee or have a fee structure to manage these types of bonds. Example, Alexandria VA charges 25 basis points per bond amount and Loudoun has a structure Bond Financing Fee Schedule – Loudoun County Economic Development, VA
- Doesn’t the City hold some risk albeit very small? The City has stated that there is no risk to its bond rating for this request. If WCCB defaults on the bond payment and the bank covering the request isn’t able to sell the property or if the bank is no longer in existence, wouldn’t the City via the VBDA be next in line to cover the bond requirement?
- How can the VBDA/CC justify approving an additional $164mil bond pass through request for the Independent Living (IL) tower until several key issues are resolved? The previously approved $110mil bond issuance supported WCCB’s Memory Unit construction. This current request supports the IL tower which is still in litigation at the State Supreme Court. The designs for the tower also require the relocation of the existing beach access which needs a super majority Council approval.
- Will the City/VBDA be asked to supply an additional bond for the remaining $140mil in the future? The Fitch Bond Rating review below states that WCCB will need $400mil in debt service to complete the full campus expansion. The previous $110mil approval plus this $164mil request still leaves $140mil. https://www.fitchratings.com/research/us-public-finance/fitch-downgrades-westminster-canterbury-on-chesapeake-bay-va-rev-bonds-to-bb-outlook-stable-18-02-2022
- Where can I obtain a copy of the Bond Application submitted for this request?
Thank you for taking the time to educate us on this somewhat confusing method of financing development projects.
Sincerely,
Todd Solomon Shore Drive Community Coalition President
#WeLoveShoreDrive 