Joel EngelhardtOut of ‘an abundance of caution,’ Palm Beach North Athletic Foundation asks the Palm Beach Gardens City Council for three more months to meet financial milestone.
The backers of a proposed ice rink complex in Palm Beach Gardens are asking the city for a three-month delay to finalize the $40 million project’s financing.
Under its April 2024 lease with the city to build the two-rink complex in Plant Drive Park, the nonprofit Palm Beach North Athletic Foundation needed its financing to be in place by July 3. The lease called for construction to begin that day as well.
Instead, the nonprofit is asking to push those deadlines to Oct. 3.
The project faced sharp criticism from residents who objected to the city’s decision to give up an 8-acre park and demolish a skateboard park that had been there since 2002 to make way for the ice rink, supported by hockey luminaries including Wayne Gretzky.
The delay and the request to extend a 15-month deadline to have the financing in place gives opponents an opportunity to renew the fight and lobby the City Council to block the project.
Under the existing contract, failure to meet the July 3 deadline would put PBNAF in default. The contract gives the nonprofit 30 days to cure the problem. By changing the deadline, the extension pushes back the default provision.
PBNAF statement
PBNAF said in a statement that it is seeking the extension out of “an abundance of caution” at the recommendation of the city.
While the terms of the financing have been approved, the statement said, the loan has not closed.
But the closing could still occur in July, and construction would start immediately afterward, the statement said.
“While we view the financing as secured, the city has advised that, under its guidelines, the milestone will not be formally recognized until the transaction is complete. In an abundance of caution, the city has recommended placing a 90-day extension on the June agenda,” the statement said.
“We see this as a standard part of the financing process and remain fully confident in our timeline and the strength of the project. We look forward to celebrating the start of construction with our partners and the community this July.”
Opposition gearing up
Opponents point out that PBNAF failed to meet its financial thresholds in 2022, forcing the city to terminate plans to build the complex in the Gardens North County District Park.
“They failed to meet financing at every level despite four extensions,” resident Rebecca McKeich said. “And here we are again.”
She pointed to a statement from PBNAF founder and President Mike Winter at the Jan. 9 hearing in which the council voted 4-0 to approve the site plan for the complex.
Winter, who could not be reached for comment last week, told the council in January that PBNAF had raised $12 million, enough to “obtain all of the financing to complete the project.”
“So we are ready to go,” he said.
Opponents prepared to argue that the council should reject the extension pointed to the lack of detail in documents posted as part of the city’s agenda.
“Where‘s the documentation that you have it?” resident Heather Deitchman said.
“If they’re so sure they’re going to get it in July, they don’t need more than the 30 days that’s in the agreement,” she said.
Rink revenues to pay off bonds
The facility has a $10 million pledge from billionaire hockey enthusiast Larry Robbins. But it is arranging financing to be paid back from revenues generated by the venue to close the gap between philanthropy and the final cost.
In a 2024 presentation, PBNAF projected fifth-year annual revenue to be $3.2 million to cover $2.5 million a year in debt service.
In 2022, the city terminated an agreement with PBNAF to build the complex in the Gardens North County District Park after it missed four fundraising deadlines during COVID and asked for the city to back its bond financing.
In this case, PBNAF is not asking the city to provide support for the bonds. To obtain tax-exempt status, it is asking for conduit bonds from the Florida Local Government Finance Commission, an entity created by local governments and overseen by the Florida Association of Counties.
Conduit bonds provide tax-exempt status, lowering the cost of interest, to raise capital for revenue-generating projects that benefit the public. The borrower is responsible for repaying the debt.
The city first learned of the proposal for tax-exempt bonds on May 2, emails provided in response to a Stet public records request reveal.
“It was nice to meet with all of you today and to learn that for the past 2-3 weeks PBNAF has been investigating conduit bond financing through the city as a means of satisfying the 15-month funding milestone,” City Attorney Max Lohman wrote in a May 7 email to PBNAF.
While he mentioned city backing, that no longer appears to be the case, although the emails do not indicate when PBNAF made that change.
The city gave PBNAF until May 27 to say whether it would need an extension so that issue could be posted on the City Council agenda for June 5.
In a May 22 email to Lohman, PBNAF’s attorney Philip DiComo said the nonprofit is finalizing a loan from a commercial lender while pursuing conduit bonds through the finance commission.
The PBNAF statement did not address the conduit bonds.
Read more: Bond financing options laid out by Ziegler Investment Banking in 2022 for PBNAF’s first proposed complex.
Joel is a founder, reporter and editor at Stet News. His award-winning newspaper career spanned more than 40 years, including 28 years at The Palm Beach Post, which he left in 2020. Joel lives with his wife in Palm Beach Gardens. He volunteers on the board of NAMI Palm Beach County and the Palm Beach Gardens Historical Society.
