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The Handbook of Municipal Bonds by FRANK J. FABOZZI, SYLVAN G. FELDSTEIN

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CASE STUDY 9
Universal Studios Road Financing: First with Special Assessment Bonds and Second with Tax Increment Financing Bonds
Hilary E. Feldstein Consultant
 
 
 
In 1996, a bond was issued by the City of Orlando to address transportation blight. Proceeds were used to construct a series of roadway access ramps and overpasses to facilitate the projected increased traffic along Interstate 4 at one particular interchange, identified as the Republic Drive Interchange. This interchange is adjacent to the main entrance to the Universal Studios entertainment and film production complex in Florida. The highway construction to accommodate increased vehicular traffic was substantially completed on time and on budget by September 30, 1998. The interchange was renamed the Universal Boulevard.
The roadway improvements were necessitated by the estimated $3 billion expansion by Universal Studios on its adjacent site. This included a second daytime theme park, a multitheme nighttime facility, five hotels with 5,000 rooms, and two 9,500 automobile parking garages. This was in addition to the existing theme park and production facilities for film and TV already located there.
The $47,400,000 bond issue to finance the highway access infrastructure improvements was the City of Orlando, Florida Special Assessment Revenue Bonds (Republic Drive Interchange Project), Series 1997A. The maturities went from 1999 out to 2017 and the coupons went from 6% in 1999 out to 6.75% in 2017. Through an interest ...

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