Gulfport, Mississippi, is hoping that alligators, river otters, dolphins and stingrays hold the key to revitalizing the economy of the second-largest city in the state.
The city, located on the Gulf of Mexico, is selling $35 million in tax-exempt bonds through a conduit this week to finance a public improvement project — the Mississippi Aquarium. The “state of the art” aquarium, set to open in 2019 with a $93 million budget, will join casinos and new restaurants in downtown Gulfport.
The city received $17 million in grants to fund the aquarium from the U.S. Department of the Treasury, which administers settlement money from the oil spill to communities affected, according to a June news release by the Mississippi Department of Environmental Quality. The grant money will construct the main aquarium building.
The special obligation bonds will be paid by city revenues and will add to the city’s $73.6 million in net direct debt in 2016, according to Moody’s Investors Service. The city will have $105.7 million in direct debt outstanding after the bond sale, the ratings company said.
Moody’s cut Gulfport’s rating one notch to A2 earlier this month, saying that the city will be pressured by higher debt and underfunded Mississippi state pensions. The “non-essential” aquarium is likely to pressure the city’s liquidity, the company said. Moody’s has a negative outlook on its rating.
Gulfport, with a population of about 72,000 people, has been hit with a string of economic challenges that predate even the 2008 recession. The city is still working on recovering resources spent on Hurricanes Katrina, Gustav and Isaac, bond documents say. It was also affected by the BP oil spill in 2010.
The aquarium is expected to attract 487,000 people per year on average and help bring in $340 million in annual revenue for the Gulfport region, according to its website. It will “operate at no cost to the taxpayer” and create about 900 jobs, the website says.
Ron Roland, Gulfport city council member, said the aquarium project will boost the city’s economy. “We’re still to some degree suffering from the K-word, Katrina,” he said. “That really decimated this entire area.”
Since then, homes and properties along the beachfront have been rebuilt, he said. Tourism has been a growing industry in Gulfport, which is like “paradise,” Roland said.
“After the BP spill, it’s sort of spiraled upward,” Roland said. The Mississippi Aquarium will join Gulfport tourism destinations like the Island View Casino, Mississippi Coast Model Railroad Museum and the Gulf Islands Waterpark.
Chris Vignes, a spokesman for the city, said city officials were not available for comment.
The aquarium contains more than 80,000 square feet of exhibits and will include animals that cover “water, land and air,” including river fish, shorebirds and alligators, according to the aquarium website. It will also include more than 50 different species of non-toxic plants.
“Many people know the Gulf Coast for our casinos, which is more adult-focused tourism and economic development,” said Adele Lyons, CEO of the Mississippi Gulf Coast Chamber of Commerce. “To have something that’s family-oriented is something everyone’s been positive about.”
Gulfport sold general obligation bonds in 2015 that priced at a top yield of 3.42 percent in 2027, about 86 basis points above the 12-year AAA benchmark at the time, according to data compiled by Bloomberg. The Mississippi Development Bank will issue this week’s bond deal, which is insured by Build America Mutual.