The Western Reserve Port Authority board gave final approval Monday to issue up to $60 million in bonds to fund the construction of the Hollywood at Mahoning Valley Race Course in Austintown.
Rose Ann DeLeon, executive director of the port authority, said that to her knowledge, the agreement with Penn National, which is building the racino, is the largest ever for the port authority. “Most of our agreements have been smaller — about $5 million, which is typical for a port authority,” she said.
There is no financial risk for providing the bonds for the port authority, DeLeon said.
“In the end, all the risk falls to the bond buyer,” she said.
DeLeon said the possibility of providing the bonds was bridged after meeting with the company about a year ago.
Penn National went through its process and determined this would be a good funding option, she said.
“It’s going to be a 10-year lease agreement,” DeLeon said. “The interest rate is not to exceed 4 percent.”
The agreement is expected to close sometime in the middle of next week, she said.
The financing provided by the WRPA board will be used to construct items such as the track, stables, parking lots and other buildings at the racetrack and racino, said Scott Lynn, board president.
Construction at the racino will create 1,000 jobs during construction and 1,000 permanent direct and indirect jobs when the facility opens, according to Penn National.
In other potential agreements for the WRPA, the port authority is working with the state of Ohio to present a financing plan for a “major company” considering relocating to the Mahoning Valley, DeLeon said.
The port authority also is in negotiations to provide bonds for energy improvements for Simon Properties, owner of Southern Park Mall, and an unidentified Youngstown company, she said.