Economic Development Authority : 7.5.10 – Minutes

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Thursday, August 05, 2010

Present: Mr. Bennett Saunders, Mr. Alphonso Taylor, Mr. Erwin Berry and Mr. Greg Kelly (Staff: Ms. Maureen Kelley)

Absent: Ms. Emily Pelton and Mr. Natt Hall

RESIGNATION: Ms. Kelley reported that Mr. Steve Crandall has resigned from the Authority to avoid any conflict of interest from a pending transaction with the Colleen Business Park. She noted that the Board of Supervisors will advertise the vacancy and make an appointment.

BOND ISSUE: Mr. Joshua Bond, representing Turman Tye River, LLC, presented an application for Authority financing to help establish a dry kiln lumber facility in the former Taylor-Ramsey building in Arrington. The business has purchased the building and is renovating it to accommodate their business. Mr. Bond noted that they will employ 14 to start and plan to employ 30 in 5 years. He said that Turman Tye River plans to be in operation by October and will be purchasing lumber, logs and sawdust from local sawmills within a 100-mile radius. The company makes hardwood flooring, compressed sawdust pellets for heating stoves and log homes and expects to process 80,000 board feet per month to start.

Turman Tye River, LLC’s application estimates the cost of the facility at $3.2 million and requests financing through the EDA not to exceed $1.3 million. The financing will be used for the purchase of the land, buildings, equipment, new buildings and equipment.

The EDA’s bond attorney, Mr. Dan Siegel, reviewed the Inducement Resolution, noting that this is just a first step in the process to issue revenue bonds. The agreement includes a $1,000 application fee and an annual fee equal to 1/8th of 1% of the outstanding principal balance (or approximately $1,250/year on $1 million). Mr. Siegel noted that although the company has already purchased the building and land, federal tax rules allow the application to retroactively include purchases/expenditures for 60 days.

After review, members voted unanimously to adopt the Inducement Resolution. The next step in the process is a public hearing on the issuance and final documents following Turman Tye River’s securing financing. Members agreed to work with the company representatives to identify and secure any local, state and federal tax breaks or assistance.

Note: Bond financing through the EDA allows qualified applicants to secure interest-free financing. It does not hold the EDA or county liable for the repayment of loans nor does it include monies from the county or EDA itself. The EDA simply serves as the conduit for the interest-free financing.

Meeting adjourned.

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