CHICAGO - The deferment of an Iowa Supreme Court decision on a lawsuit casts uncertainty over the December debt service payment on $40 million of bonds issued to finance construction of Prairie Meadows racetrack in Polk County, according to a Moody's Municipal Credit Report released yesterday.

The suit filed against Polk County claims that the lease purchase agreement between the county and the Racing Association of Central Iowa, which owns the racetrack, violates a state law. According to the suit, the law prohibits a government unit from pledging its taxing powers to pay debt service on revenue bonds issued to benefit a private entity .

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.