WILKES-BARRE TWP. — A higher valuation of the Mohegan Sun Arena at Casey Plaza will drive up insurance premiums, the authority that owns the facility learned Wednesday.
The arena, that opened in November 1999, increased in value to $87.6 million from $79 million last year, representatives of Assured Partners in Plains Township informed board members of the Luzerne County Convention Center during their public meeting at the facility.
Premiums likewise increased to $192,795, up from $179,696 under the existing liability coverage that expires in two days, and a separate active shooter/active assailant policy could further raise insurance costs between $14,000 and $15,000. The board approved renewing the policies at the higher cost, but asked Assured Partners to look into higher deductibles that could reduce premiums and pay for the additional policy.
The board dealt with another financial matter that will cost it approximately $70,000.
Michael Vind of Financial Solutions, the authority’s financial adviser, explained the mechanics of amending a loan to comply with a new rate index to go into effect after June 30, 2023.
“The authority has one piece of debt outstanding in the amount of $21.45 million . It matures in 2035,” Vind said. It carries an interest rate of 3.23% through FNB, he added.
In preparation for the switch to the Secured Overnight Financing Rate from the London Interbank Offered Rate the loan documents have to be changed to reflect the switch.
FNB agreed to continue the existing rate, Vind noted.
“From a debt service perspective it’s going to be neutral. We think this is very good outcome,” Vind said.
Vind recommended the board pay the cost out-of-pocket to amend the loan. The alternative of amortizing the cost…