City Official: Delay in arena construction could cost taxpayers additional $10-20 million

An outside legal expert brought in to weigh the legal ramifications of moving the Multipurpose Performing Arts and Entertainment Facility outside of Downtown El Paso told city council representatives a change in location would take a revote.

Attorney Paul Braden, the head of public finance for Norton Rose Fulbright who specializes in bond financing, made his presentation during Tuesday’s city council meeting.

Braden said the city’s proposition language is clear, in his opinion, and the contract with voters calls for the location of the arena to be Downtown El Paso.

“This is very atypical and very unusual to do anything like that. So we would have to go through all types of pre-clearances to discuss it,” Braden said.

Council could decide to send the issue back to the voters at a cost of $180,000, the city clerk told representatives. An additional $60,000 would be needed for publication of the election. The earliest election would be November 2017.

City attorney Sylvia Borunda-Firth warned council sending the arena back to voters, without a stipulation for it to be built downtown, would be a complicated process.

“But I think we would be a few steps back from that because there is also some additional considerations before you decided to do that with regard to an analysis to what would happen to the expenditure of funds that have already occurred and the general fund having to reimburse,” Borunda-Firth said.

City Manager Tommy Gonzalez said the city has already spent $1.8 million on arena site selection and City Reps. Emma Acosta, Claudia Ordaz and Jim Tolbert argued another election would be too costly.

“I think it would be fiscally irresponsible to call another election. It shows that there is no leadership up here if we have to go back and do a revote. It to me would not make any sort of sense,” Ordaz said.

Braden said a revote would be unique and complicated, while adding there is not much precedent for such a move involving a bond ordinance.

“There is a lot of distrust with from people in the public as it stands today. so if we ignore or overturn a vote by the voters, i think it’s very dangerous to do that,” Robinson said.

Deputy City Manager Khalil Zaied told the council a delay in construction of the arena could result in $10 to $20 million in additional costs.

“I don’t think that is something we want the city to be known as — that we cannot make a decision. I think the voters made the decision for us. And I think we should honor that decision that was voted for by this community,” Acosta said.

The city’s original location would put the Downtown arena where the Duranguito neighborhood now stands, a move which angered historians, area residents and preservationists.

City Attorney Sylvia Borunda-Firth addressed staff, Mayor Oscar Leeser and reps at a special city council meeting Monday.

“At the council’s direction, the staff is continuing on all options. We are supposed to be bringing them all to you to make ultimate decisions. With regard to the proposal to move it out of the Downtown area, there are significant legal barriers to doing it,” Borunda-Firth said.

Some members of the public and city representative Lily Limon have asked the question: Why not build the arena in another part of El Paso?

Borunda-Firth has repeatedly said during council meetings changing the location of the voter-approved arena would have significant legal barriers. “I have said it several times and it doesn’t seem to be accepted,” Borunda-Firth said.

Borunda-Firth wanted to make sure the findings were shared during open session.

“So that the members of the public who continue to advocate for it to be moved out of the downtown area can hear that there are some very significant legal barriers to doing it. And that it comes from the public finance law and the bonds,” Borunda-Firth said.

City Rep. Peter Svazbein agreed. “I think it is important to inform and educate the public even going to extra step of hiring an outside counsel who is the expert of bond financing,” Svarzbein said, “I think it would help to sway some of those concerns that seem to be being brought up again and again about what options and how easy or not easy it is to move it and also the legal ramifications of that.”

City Rep. Limon is not giving up the fight to exclude the Duranguito neighborhood from a possible location for the downtown arena.

“We know for a fact Duranguito has a lot of questions, and as long as we have one holdout, we will not be able to build in that area,” Limon said.