LOUISVILLE, KY. (WDRB) --Louisville's Metro Council President says there is money available to help the downtown KFC Yum! Center with its cash flow problems.
WDRB News spoke with Council President Jim King on Tuesday about where $5 million in additional arena funding could come from.
To build the arena several years ago the Arena Authority had to finance it with bonds.
But to get the bonding approved, King said, the authority was required to set up a reserve fund.
"The bond underwriters required a debt service reserve of $15 million to be set aside," he said.
King says that money has now grown in value.
"It has increased in value somewhere between five and seven million dollars," he said, "so the debt reserve has grown from $15 million to $20 million.
As council president, King is a non voting member of the arena authority. He also is a CPA and owns King Southern Bank.
He says he is encouraging the authority to take advantage of the growth in the reserve fund.
"Currently we have the arena authority's law firm looking at a negotiated sale of some or all of that investment," he says, "which would yield a potential $5 million."
The arena's financial condition has been the subject of concern for several months after the authority had to take money from a maintenance fund to make a debt payment.
But at the arena's authority's most recent meeting in August the new operator of the arena, AEG, projected a $1 million profit during the coming fiscal year as it seeks to book more events.
King says people need to keep the arena's financial problems in perspective.
"It is not a crisis and to some extent this is a start-up business and most start-ups have difficulty in the first few years," King said.
King said he also expects the revenue from the special tax increment financing district around the arena (or TIF) revenues to grow.
Up to now money from the TIF district has come in lower than projected.
A report on the latest TIF numbers is expected at the authority's next meeting scheduled for this coming Monday.
King said he's not sure if a recommendation will be ready by next week on using the reserve funds, but that negotiations are continuing with the investment bankers.
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