August 11—TWP WILKES-BARRE. – A higher valuation of the Mohegan Sun Arena in Casey Plaza will drive up insurance premiums, the facility’s owner authority learned Wednesday.
The arena, which opened in November 1999, has risen in value to $87.6 million from $79 million last year, representatives from Assured Partners in Plains Township told council members. administration of the Alfalfa County Convention Center during their public meeting at the facility.
Premiums have also increased to $192,795 from $179,696 under existing liability coverage which expires in two days, and a separate active shooter/active aggressor policy could further increase insurance costs between 14,000 $ and $15,000. The board approved renewing the higher cost policies, but asked Assured Partners to consider higher deductibles which could lower premiums and pay for the additional policy.
The council has been busy with another financial matter that will cost them approximately $70,000.
Michael Vind of Financial Solutions, the authority’s financial adviser, explained the mechanism for modifying a loan to comply with a new rate index that will come into effect after June 30, 2023.
“The authority has an outstanding debt in the amount of $21.45 million. It matures in 2035,” Vind said. It carries an interest rate of 3.23% through the ETF, he added.
In anticipation of the move to the London Interbank Offered Rate overnight secured funding rate, the loan documents should be amended to reflect the change.
The FNB agreed to maintain the existing tariff, Vind noted.
“From a debt service perspective, it will be neutral. We think that’s a very good outcome,” Vind said.
Vind recommended that the council pay the costs out of pocket to modify the loan. The alternative of writing off the cost of the loan would raise the rate and add between $300,000 and $400,000 of debt over the course of the loan, he said.
The board accepted the recommendation giving Financial Solutions the authority to prepare a resolution for approval at the next meeting on September 14.
Board chair Donna Cupinski announced the formation of a committee to prepare for the arena’s 25th anniversary in 2024. In addition to Cupinski, members include Steve Barrouk, the first board chair, Will Beekman, chief executive arena for management company ASM Global, state Rep. Eddie Day Pashinski, D-Wilkes-Barre and representatives from the Greater Wyoming Valley Chamber of Commerce and the Luzerne County Convention and Visitors Bureau .
Contact Jerry Lynott at 570-991-6120 or on Twitter @TLJerryLynott.