Reported by Sara Dorsey
NASHVILLE, Tenn.Progress is being made on the 16-acre Music City Center site, but already the convention center project is running into some unexpected delays.
Video: City Calls Convention Center Delays Minor
Heavy machines are tearing down buildings, clearing and leveling the land that will eventually house the 1.2 million-square-foot center. To pay for it all, city finance officials are preparing to embark on a five- or six-city roadshow to try to sell the bonds to major investment funds.
But the process is running a few weeks later than expected because of a state interest rate law that sets the maximum payment on bonds at the prime rate plus four -- which is about 7.25 percent.
"It's possible that some of the Build America bonds, in order to sell them, might have a coupon rate that is higher than that 7 and a quarter," said Metro Finance Director Rich Riebling. "We are not paying 7 and a quarter, because the federal government is going to subsidize us back some 35 percent of that number. Technically, we are paying less, but under state law, we could be in violation of the usury law."
New legislation is working its way through the House and Senate to allow consideration of that federal subsidy.
But that isn't the only slowdown: Finding a home for the Greyhound bus station -- the last piece of property the city is waiting on -- has proven difficult.
"They have some unique needs, and so it's not been an easy one to relocate," said Riebling.
The city is calling the delays minor, saying that they can be made up as the project moves forward. The city still believes it can finish both on time and on budget.
The center is supposed to be finished in 2013. Already, about 30 conventions are on the books.
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