Kalahari Resorts agrees to EDA fee on tax-exempt financing

Kalahari Resorts has agreed to pay the Fredericksburg Economic Development Authority’s annual fee on the $25 million in tax-exempt financing to be used for the planned $260 million project in Fredericksburg’s Celebrate Virginia South. This would amount to a $31,250 annual payment from Kalahari to the city EDA for 10 years. The EDA would use the money for economic development in the city. Kalahari is asking the EDA to waive its fee on the roughly $220 million-$240 million taxable portion of the financing plan (Kalahari would also put up about $30 million of its own money; the total costs of buying the land from the Silver Cos. and developing the resort would be about $260 million, and the additional amount borrowed would go toward financing and other costs). The EDA will meet May 10 to discuss the waiver request. Click here for some background information on this, and see tomorrow’s FLS for more details.

Also, click here to see a report on the economic impact that Kalahari is expected to have on the city.

Click here to read a letter Kalahari’s attorney sent the city/EDA dated April 8. This reveals that Kalahari has already spent about $3 million on the project.

Click here to read the follow-up letter dated April 22 that Kalahari’s attorney sent the city/EDA. This reveals that the going interest rate on the taxable portion of the financing package is about 11 percent.

Click here to read the letter that City Manager Bev Cameron sent to the governor’s office asking for an additional $10 million in Recovery Zone Facility (tax-exempt) bonds for Kalahari.

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