Platte County prevails in lawsuit against Zona Rosa bond trusteeRoss Martin
Circuit Court Judge James Van Amburg recently issued a decision granting summary judgment in favor of Platte County in its declaratory judgment action against UMB Bank, N.A., the Trustee for the Zona Rosa Bonds. Graves Garrett attorneys Todd Graves, Dane Martin and Jennifer Donnelli represent Platte County in the case.
In its order, the court rejected the trustee’s demand for Platte County to pay shortfalls on the Zona Rosa Bonds in 2018 and each year thereafter. This demand would have imposed on Platte County an immediate liability of $765,390.95 and a long-term liability of up to $40 million through 2032.
The court agreed with Platte County’s position, finding that Platte County never agreed to make any payments to cover shortfalls for the Zona Rosa Bonds. This issue has received both local and national media coverage, including an op-ed from Bloomberg titled, “Bondholders Should Never Think They’re Above Taxpayers.”
“The Platte County Commission’s lawsuit has saved Platte County taxpayers tens of millions of dollars,” Graves said. “The Court was correct to reject the Trustee’s effort to impose a bondholder bailout on taxpayers. The Zona Rosa Bonds will continue to be paid using the dedicated 1 percent sales tax in Zona Rosa, as has always been the case.”
In its lawsuit, Platte County sought a declaration from the court regarding the validity of the trustee’s demand that it cover shortfalls for the Zona Rosa Bonds. The Zona Rosa Bonds were issued by a third-party entity, not Platte County, to finance parking garages in the Zona Rosa shopping center. Under the Financing Agreement, the bonds are payable from a 1 percent sales tax in Zona Rosa.