LOUISVILLE, Ky. (WDRB) – A group of Kentucky state lawmakers has introduced a bill that would require the Louisville Arena Authority to formally abide by transparency, tourism and other measures.
House Bill 572 would ensure that the arena board follow open meetings and open records laws and state procurement rules, as well as make annual disclosures meant to identify possible conflicts of interest.
Those provisions were included in the state’s 2006 budget bill, which set aside $75 million in initial funding for what became the KFC Yum! Center. Subsequent bills didn’t include the requirements.
The 15-member board, a nonprofit entity appointed by Kentucky’s governor and Louisville’s mayor, holds public meetings and responds to records requests. But it was faulted in a state audit last year for failing to seek competitive bids when it extended arena manager AEG's contract in 2015; arena officials contended they amended an existing contract.
The bill also would force the removal of some of the board’s longest-tenured members, calling for the terms of current board members to expire by July 31. They only could be reappointed if they have less than four years of service.
That would affect the arena authority’s vice chairman, William Summers V and fellow board members Alice Houston and Lindy Street – all of whom have been on the authority since it was established in 2006.
The bill’s chief sponsors are Democratic Rep. Jim Wayne and Republican Rep. Phil Moffett, with 13 co-cosponsors from both parties. All of the lawmakers are from Louisville.
The arena authority is continuing to research the proposed legislation and how it might affect the Yum! Center, chairman Scott C. Cox said.
"Our most immediate concern is whether becoming more closely aligned with the Commonwealth could change the obligation on the recently refunded municipal bonds," cox said in a text message.
If becoming a part of a state agency shifted that responsibility from the arena board to the state, it could cause the bonds to be reissued a second time at far less competitive rates, he said.
In December, the arena authority refinanced the building's debt by selling $377.8 million in new bonds -- a move meant to make annual debt payments more affordable.
Cox said the arena authority would comply with any new state laws.
The bill would attach the arena authority to the Kentucky Tourism, Arts and Heritage Cabinet and “ensure that its efforts conform to marketing and promotion strategies devised” by the tourism agency. The arena board, however, would continue to control all arena activities.
In a statement, Wayne said the measure is a response to a review last year by Kentucky Auditor of Public Accounts Mike Harmon, whose office noted that taxpayer protections for the arena had been “weakened” because the transparency language hadn’t been renewed by the state legislature.
“With the significant investment the state puts into the arena, it’s important to make sure that it’s managed in the responsible and transparent manner called for by House Bill 572,” Wayne said.
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