DALLAS - Higher-than-expected interest rates on $294.3 million of auction-rate debt issued in 2006 by the Louisiana Stadium and Exposition District and lower-than-anticipated revenue from the district's 4% hotel tax have created a financial whiplash for the Louisiana Superdome in New Orleans.

The district issued the debt in March 2006 to provide $40 million for repairs to the stadium damaged by Hurricane Katrina in August 2005, refund the district's existing debt of approximately $200 million, and provide $25 million of working capital for the district until revenues reached pre-hurricane levels. Some $10.5 million of the proceeds from an uninsured tranche repaid a 2005 note representing a loan Merrill Lynch & Co. had made to the district.

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