tag:blogger.com,1999:blog-30130444.post115393243470250486..comments2024-02-16T09:00:32.845-06:00Comments on FromDC2Iowa: "Show Me The Money"Unknownnoreply@blogger.comBlogger4125tag:blogger.com,1999:blog-30130444.post-1153961785100333112006-07-26T19:56:00.000-05:002006-07-26T19:56:00.000-05:00John:I don't think "revenue bonds" are an option f...John:<BR/><BR/>I don't think "revenue bonds" are an option for the rain forest whether or not it has sufficient revenue. See "Revenue Bond," <I>Wiipedia.org</I>. A revenue bond, it says, is a form of municipal bond (although sometimes available to other government agencies).<BR/><BR/>The rain forest, as a project of what I believe is still called the Iowa Child Foundation, is a Section 501(c)(3), or non-profit, private organization.<BR/><BR/>So far, as the media's reporting reveals, there is somewhere between "little" and "no" interest (or even involvement) from the municipalities of Riverside and Pella. Such enthusiasm as exists for this project -- aside from the promoters -- is coming from a land developer in Pella, and a casino owner in Riverside (or South Carolina, as I believe his home to be). They presumably see the prospect of some added profit for their wholly owned venures if they can get enough public money put into the rain forest to get it built and operating.<BR/><BR/>But all of this comment of mine is a detail. Your concerns (and mine) remain whether this is a bank loan or the project is purchased by a municipality and then run with "revenue bonds." Where is the money coming from to keep this thing running and pay off the principal and interest of a significant debt?<BR/><BR/>-- NickNickhttps://www.blogger.com/profile/08467682953748756539noreply@blogger.comtag:blogger.com,1999:blog-30130444.post-1153958586953267042006-07-26T19:03:00.000-05:002006-07-26T19:03:00.000-05:00The info on Iowa Radio was that the total start up...The info on Iowa Radio was that the total start up cost of the Iowa Rainforest Project was estimated to be $155 million.<BR/><BR/>$50 million of Federal funds<BR/>$25 million of matching funds provided by the home community<BR/>$25 million of matching funds from unspecified sources. I assume that means they are looking under sofa cusions for loose change.<BR/>$55 million to be borrowed.<BR/><BR/>My point was they cannot sell revenue bonds until they have revenue. <BR/><BR/>Suppose they can find enough suckers to buy $55 million of ten year bonds at 5% interest will they generate enough income to pay their expenses plus debt service of $6.4 million per year. You say no way and I agree.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-30130444.post-1153951616922569582006-07-26T17:06:00.000-05:002006-07-26T17:06:00.000-05:00John: It's not that there's "no revenue," it's jus...John: It's not that there's "no revenue," it's just that the odds are high there won't be enough revenue.<BR/><BR/>Since most of the attendance at attractions (other than the mega-spots, like Disney) comes from within 50-100 miles, let's assume Earthpark can attract from the entire state of Iowa -- even though some Iowans live 250 miles or more from Riverside.<BR/><BR/>To pull in the 1-1.5 million visitors a year the promoters are projecting would require that every Iowa man, woman and child -- from birth to death -- visit this place every two years throughout the entirety of their lives, without fail. I just find it improbable that would happen.<BR/><BR/>As for lenders, I've asked local bankers if they would lend up to their maximum loan level for a project of this kind (not that such amounts would come close to being enough), given its absence of business plan, limited prospects of revenue, etc. None would.<BR/><BR/>NickNickhttps://www.blogger.com/profile/08467682953748756539noreply@blogger.comtag:blogger.com,1999:blog-30130444.post-1153943374146808072006-07-26T14:49:00.000-05:002006-07-26T14:49:00.000-05:00The folks who buy revenue bonds are very picky. Yo...The folks who buy revenue bonds are very picky. You have to prove to them that you have an established source of revenue. <BR/><BR/>Are there any lenders who will supply such a large amount of start up money when there is no revenue?Anonymousnoreply@blogger.com