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Financing for port on council’s agenda - The Galveston County Daily News : Local News

November 27, 2014

Financing for port on council’s agenda

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Posted: Sunday, July 20, 2014 9:25 pm

GALVESTON — A  proposal by the Port of Galveston that seeks to use the city to secure $13 million in financing for a terminal expansion project will be discussed during the city council’s workshop meeting on Thursday, according to an agenda posted Friday.

The port is seeking the city’s help after local banks declined to make such a large loan with a small amount of collarterall to back it. In June, the Wharves Board of Trustees proposed that the city issue subordinate lien revenue notes to finance improvements instead.

The notes would not be sold in public markets and would not put the city at risk if the port is unable to service the debt, officials said. The debt would be paid back by the revenues from the increased cruise business generated by the expansion.

Port officials say they need to expand Cruise Terminal 2 from its current size of 90,000 square feet to 150,000 square feet. The expansion, they say, will allows larger cruise ships to come to Galveston by providing more space for embarking and disembarking passengers.

Currently, Terminal 2 has space for 5,200 passengers at a time. The proposed expansion would make room for 8,400 passengers, as well as for expanded areas for passenger screening, baggage handling and customs enforcements.

The port is already $55 million in debt, largely because of investments made to accommodate cruise ships. The port is a utility of the city, but is not supported by taxes. Its revenues come from passenger fees as well as parking fees from port-owned lots.

The topic will be discussed only, according to the agenda. No vote has been scheduled.


 

 

What: Galveston City Council

When: 10 a.m., Thursday

Where: City Hall, 823 Rosenberg Ave.