The Ernest N. Morial New Orleans Exhibit Hall Authority could issue up to $92 million of tax-exempt revenue bonds for a riverfront development effort under a bill being considered by the Louisiana Senate.
House Bill 516 was approved, 70-20, by the House. The measure has been referred to the Senate Committee on Revenue and Fiscal Affairs.
The bill authorizes the Authority to issue bonds to fund half of a proposed $184 million project along the Mississippi River. The Authority's bonds would be supported by hotel tax revenue.
The other $92 million will come from state capital outlay funds, which are funded through the sales of general obligation bonds.
The bill amends current state law so that the Authority can use bond proceeds to help finance the development on public land upriver from the convention center. The project will include a private hotel, retail, and restaurants on public land.
Bill sponsor Rep. Walt Leger III, D-New Orleans, said the expansion is necessary to keep the Morial Center competitive with national rivals.
If the bonds are approved by the Legislature and later by the State Bond Commission, the Authority said the debt would be issued by the end of January 2014. The bond-financed projects are to be completed by 2017.
The Authority's $148 million of outstanding debt is rated A2 by Moody's Investors Service, A-plus by Fitch, and A-minus by Standard & Poor's.
Debate is to begin Thursday on Senate Bill 204 authorizing $251.6 million of state bonds for construction projects by the Louisiana Community and Technical College System. The bill stipulates that the bonds will not count against the constitutional cap on annual debt service.
Bill sponsor Sen. Rob Ardley, R-Benton, said the funding is needed because the state's capital outlay system is not providing the needed facilities fast enough.
Treasurer John N. Kennedy opposes the new debt, contending that the $251 million of bonds will jeopardize the state's credit rating.