Good news on two big civic projects in Downtown Denver! The state’s proposed new History Museum and Justice Center projects were funded through the sale of bonds on Wednesday. Here’s the complete press release from the state Treasurer’s office:
History Center-Justice Complex Project Financing a Success
Project will create close to 2,000 jobs in next four years
Denver- The successful financing of over $338 million in Certificates of Participation earlier today to build the new Colorado History Center and the Ralph L. Carr Justice Complex completed one of the largest sales of Build America Bonds to date, announced State Treasurer Cary Kennedy, and will directly create nearly 2,000 jobs.
“Colorado’s strong credit rating and sound financial policies allowed us to finance this project in what remain extremely difficult markets,” said Kennedy. “Investors continue to find Colorado an attractive place to invest their funds.”
“These projects will help energize our economy and create jobs,” Gov. Bill Ritter said.
“The Recovery Act provided us with financing tools like Build America Bonds, and these tools will be critical to leading our economy forward and putting Coloradans back to work.”
Build America Bonds, or BABs, lower costs to public entities on financing because the federal government subsidizes 35% of the interest paid on the project. BABs will cut the costs of these projects for Colorado’s taxpayers nearly $77 million from traditional tax-exempt financing.
The Build America Bonds program is one of several financing programs created by the Recovery Act to help government agencies move capital construction projects forward while saving hundreds of millions of dollars. Other major sales are planned for coming weeks.
The financing will pay for the costs of two new buildings, the Ralph L. Carr Justice Complex, which will consolidate the Colorado Supreme Court, the Colorado Court of Appeals, the Attorney General’s Office, the administrative offices of the court, the public defender, and other justice related entities into one location. The current building housing the Supreme Court and Court of Appeals has significant maintenance, ADA, security and life-safety issues.
The second building will house a new Colorado History Center to replace the existing Colorado History Museum. The current museum serves nearly 1 million people annually through a variety of programs, but has extensive maintenance issues and limited space.
The new Justice Complex is being funded with Judicial Court user fees and rental payments from building occupants. The History Center will be funded with allocations from state gaming revenues.
Rep. Don Marostica, a member of the Joint Budget Committee, said that the COP sale would be greatfor the local economy. “Our timing getting into the market was ideal,” said Marostica. “We are able to get a great interest rate for the state, save the citizens’ money, and keep people working.”
“We are very excited to begin construction on the new History Center, which will serve as an important statewide hub and educational resource for residents and visitors,” said Ed Nichols, the President of the Colorado Historical Society.
The Center should break ground before the end of August, with the Justice Complex to follow next year. The History Center is scheduled to open in Fall 2011 at 12th and Broadway, one block south of its current location. The Judicial Complex will start construction in 2010, with completion in 2013.
Jerry Maroney, State Court Administrator for the Colorado Department of Justice, noted the longterm savings of the project. “Ultimately, we’ll save an estimated $60 million in rent payments and efficiencies over the next 30 years as we consolidate offices into one location.”
The underwriting firms of George K. Baum & Co., Piper Jaffrey, and RBC Capital Markets managed the sale of the Certificates of Participation. The firm of Trammell Crow is the project construction manager.
The certificates were sold over two days (Tuesday and today) at an “all-in” interest rate of 4.24 percent. A COP offering is similar to that of a bond, with the most significant difference being that repayment is dependent on an annual appropriation.
Senate President Brandon Shaffer, Senate Minority Leader Josh Penry, Speaker of the House Terrance Carroll and Rep. Marostica sponsored Senate Bill 08-206 which authorized the sale of COPs and the construction of the History Center and Justice Complex projects.
Kennedy worked with Speaker Carroll and Senate President Shaffer to pass House Bill 09-1346 this past legislative session. The bill allowed Colorado to take advantage of specific financing mechanisms within the American Recovery and Reinvestment Act.
Hopefully, we’ll see a final design of the History Museum and a preliminary design for the Justice Center soon. I noticed the other day there’s construction equipment already on new Museum site.
In February, 2008, the site for the new Museum was selected after a somewhat controversial proposal to locate the new museum inside Civic Center Park.