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Urban Redevelopment Agency panel delays bond issue

Monday, March 3, 2014 8:28 PM
Last updated Tuesday, March 4, 2014 2:24 AM
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A reconfigured downtown agency declined to sign off on a $28.5 million revenue bond issue Monday after members questioned how the bonds will be paid off if voters don’t approve a new special purpose local option sales tax May 20.

Susan McCord
Government Reporter
Twitter: @reportr1
E-mail | 706-823-3215

The Augusta Commission voted almost a year ago to make the bond issue the funding source, with debt service to come from a future SPLOST, to complete $40 million in renovations at the Augusta Municipal Building complex in the 500 block of Greene Street, and the construction project is well underway.

At a Monday meeting of the new Urban Redevelopment Agency, however, members agreed the city commissioners “weren’t 100 percent convinced of the ramifications” of issuing debt without a certain repayment scheme, said chairman Henry Ingram.

Ingram, downtown activist Brad Owens, former mayor Bob Young, Universal Plumbing owner Larry Jones and Augusta Technical College President Terry Elam were named to the board last month by Mayor Deke Copenhaver at the commission’s recommendation. They replaced a prior URA panel first assembled in 2010 to issue debt to finance the ongoing Laney-Walker and Bethlehem redevelopment projects, but whose terms had expired in the 18 months since members last met.

While the former URA met rarely and did not prepare an annual report or budget or obtain an audit as required by an intergovernmental agreement with the city, the new URA “could be a very active board,” said Jim Plunkett, special city counsel over the projects.

The new URA is assigned to a reconfigured downtown redevelopment district that includes the Laney-Walker and Bethlehem tracts as well as the municipal building complex, the James Brown Arena and Bell Auditorium complex, the former main Augusta library building, the former chamber of commerce building on Broad Street, the riverfront former depot property in the 500 block of Reynolds and the publicly-owned portions of Port Royal, the riverfront condominium complex, Plunkett told board members.

Invited to attend, Housing and Community Development Director Chester Wheeler said he’d need two to three hours with each member individually to explain the Laney-Walker and Bethlehem projects’ status. Last year, Wheeler said the projects had run out of funds and needed a $2.5 million “bridge loan” to cover consultant expenses until more funds – borrowed against the project’s guaranteed allocation of $37.5 million in hotel-motel room charges – became available.

The URA members– particularly Owens and Young – questioned Plunkett and Deputy Finance Director Tim Schroer about paying off the debt if SPLOST 7 fails. Commissioners approved Friday a $194.3 million sales tax package to present to voters May 20, as well as to ask them to approve a separate $21.7 million bond issue to jump-start several SPLOST 7 projects.

Plunkett said the backup plan for a SPLOST defeat was to use all of the city’s existing 0.71-mill property tax levy that is currently reserved for capital outlay to cover service on the bonds.

“I don’t believe that you can rob from the capital budget to pay bonds,” Young said. “The city is potentially on the hook for $2.9 million a year to service the debt if SPLOST fails.”

Meanwhile, according to Schroer, the municipal building renovation is low on funds. Started a year ago using SPLOST 6 dollars, the $40 million renovation project’s “cash flow is getting critical,” Schroer said. “We are dangerously close to running out of funds on this project.”

Schroer said he didn’t know how long the project could sustain without the bond issue, but Plunkett said the commission would have to halt the project if the board didn’t agree to the bond issue. “If we don’t borrow the money and receive the $28 million,” Plunkett said, “we stop building.”

The URA panel, with Elam absent, voted unanimously to table a decision on the bond issue until May 21. Ingram encouraged the board members to speak with their city commissioners about their intentions for moving forward. “We might vote earlier,” he said.

Comments (11) Add comment
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David Parker
7923
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David Parker 03/03/14 - 11:05 pm
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The city is bleeding and

The city is bleeding and should reach out to the community for ideas. Get you a list of anything significant enough for immediate action. We can go from there and apply the medicines. #teardownthiswall

nocnoc
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nocnoc 03/04/14 - 05:44 am
5
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Wow ! what a novel concept for a ARC Agency lately,

wait until they know they have the $$$$ for before spending it.

A good of the difference in the new type of people coming onboard.

If they signed off on the bond, it was approved and the SPLOST failed it would leave the declining number of Taxpayers hanging to making up $28+M not in the budget.

Riverman1
102911
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Riverman1 03/04/14 - 06:51 am
8
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Chester, You Kidding Me?

"Invited to attend, Housing and Community Development Director Chester Wheeler said he’d need two to three hours with each member individually to explain the Laney-Walker and Bethlehem projects’ status."

What a diversion. In other words, he’s saying you people on the URA are not smart enough to understand what we do with the money. Just keep it coming. Millions have been given to Wheeler with little to show for it and he doesn’t want to talk about it. Are you kidding me?

corgimom
43046
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corgimom 03/04/14 - 06:55 am
6
1
Bob Young and Brad Owens were

Bob Young and Brad Owens were just what was needed, finally some people are on board that are intelligent and responsible!

nocnoc
54519
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nocnoc 03/04/14 - 07:18 am
4
1
C-Mom I agree with you again

Putting new people with brains on the URA will hopefully put a plug in that formerly unaccountable Bottomless $$$$ pit.

raul
6510
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raul 03/04/14 - 08:04 am
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This should be fun.

This should be fun.

Brad Owens
5180
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Brad Owens 03/04/14 - 08:19 am
2
1
Riverman1...

In all fairness, what Mr. Wheeler wants is a two or three hour long work session with all of there so he can give a complete "download" on what has been done with the money the URA provided instead of a ten minute PowerPoint briefing. This is to include an actual tour of the area so we can physically see the projects in site as well.

I am anxious to give him that opportunity.

@corgimom & nocnoc, thanks for the very kind words.

nocnoc, We were all in agreement on the issue of the bonds, we need a dedicated revenue source for "revenue" bonds. We want to make sure the Commissioners are 100% clear on this before we potentially hang an extra $3,000,000.00 a year on the yoke around the taxpayers necks.

Corgimom, I would add that all of the board members are very intelligent, engaged and informed. This board will work well together to protect the interests of the taxpayers.

Brad

seenitB4
108321
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seenitB4 03/04/14 - 08:30 am
3
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Thanks Brad

Feedback is what a voter needs....

Riverman1
102911
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Riverman1 03/04/14 - 09:36 am
2
2
Brad, it is one thing to give

Brad, it is one thing to give a 2-3 hr.workshop with all the members. But what he said is he needed to do it individually which would take forever and I interpret as stalling. However, you're there and one of us, so I'll accept your opinion. Good luck.

Sweet son
12776
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Sweet son 03/04/14 - 11:37 am
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To me, it would be obvious if I created debt that I would have

a plan to pay it back before I got into that situation.

dichotomy
40536
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dichotomy 03/04/14 - 12:18 pm
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I'd like to see a public

I'd like to see a public audit of Housing and Community Development and who has been paid what for property, consulting, etc. At BEST there seems to have been mismanagement if Chester has outspent the funding stream. Seems to me that needing a $2.5 MILLION dollar bridge loan to pay CONSULTANT fees IS A MIGHT EXCESSIVE on consultant fees.

Butterman
3696
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Butterman 03/04/14 - 10:01 pm
1
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Brad Owens and Bob Young
Unpublished

Were 100% right on this. I knew Bob would do the right thing but was not so sure about Brad. Looks like he was a good pick after all. Looks like this URA board has a better handle on things than Commissioners. Think we can trade?

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