April 8 (Bloomberg) -- An agency in Scottsdale, Arizona, plans to issue about $50 million of municipal bonds next month to fund construction of the Museum of the West, a city-owned venue that will display cultural artifacts.
Backing will come from Scottsdale’s sales taxes, state- shared revenue, franchise taxes and permit fees, according to Moody’s Investors Service, which rates the bonds Aa1, second- highest. A nonprofit will operate the facility, according to Scottsdale’s website.
The borrowing is another example of economic development in Arizona, whose economy was among the hardest hit by the 18-month recession that ended in June 2009. A public agency is selling parking bonds to jump-start a project in Tempe that includes the future headquarters of USA Basketball. Glendale’s credit rating has fallen after it issued more than $355 million of debt for professional sports venues.
“The project represents a unique opportunity for the city of Scottsdale to attract national and international prominence as a tourism capital,” according to the website of the municipality of about 224,000.
The museum will expand the number of tourists by “displaying cultural and artistic artifacts and exhibits displaying the meeting of the ‘Old West with the New West,’” the website says.
The Scottsdale Municipal Property Corp. will issue the securities as soon as May 7, according to Moody’s. Portions of the deal will also bolster the city’s wastewater system and refinance debt, the New York-based company said in an April 4 report.
Gary Meyer, Scottsdale’s project manager for the museum, didn’t return a voicemail seeking comment on the bond sale.