The Oconee County Industrial Development Authority agreed on Monday to contribute $50,000 to the nearly $700,000 payment due next year for the bond for Caterpillar, but IDA Chairman Rick Walker told anyone who was listening not to expect a similar payment in the future.
The payment for the Caterpillar bond was part of the $120,500 budget approved by the Authority at its regular meeting in the Courthouse on Monday afternoon.
Final approval of the budget and bond payment followed a detailed presentation and discussion of the budget and of the bond payment details.
During the nearly half-hour discussion, however, no one mentioned the word Caterpillar.
Even the item on the budget was labeled simply ‘ALLOCATION - REVENUE BOND, SR2012, DEBT.”
The bulk of the revenue that the IDA receives comes for rent on the Post Office building in Watkinsville, which the county owns.
By agreement between the Board of Commissioners and the IDA, the development authority receives the rental income, which is budgeted at $109,400 in the fiscal year starting on July 1.
The debt payment for the Caterpillar bond is the biggest expenditure in the new budget.
Waller said that the IDA could afford to make the payment this year because the county had received a grant from the Georgia Department of Transportation for construction of a roadway at the IDA’s Gateway industrial park.
Waller thanked Rep. Chuck Williams and Oconee County Board of Commissioners Chairman Melvin Davis for getting those state funds, as the video below shows.
OCO: Waller On Bond Payment from Lee Becker on Vimeo.
He said the Authority would not make a contribution of the $50,000 size, and might not make any contribution, in the future.
Starting in the final quarter of this year, the IDA will begin receiving money from the 2015 Special Purpose Local Option Sales Tax approved by voters last November.
County Finance Director Wes Geddings said the Authority would need to start thinking about how it wanted to spend that money.
Though SPLOST is, by name, for special projects, the county simply said the money was for “Economic Development Facilities” and left it at that.
Geddings, who also handles IDA finances, said the group would not have the money to spend until the tax was collected. The 1 percent SPLOST runs for six years.
Geddings, in reviewing the financial report for the IDA at the meeting on Monday, told the members that the Authority had $260,931 it is “infrastructure account” at present.
He said that he would need to withdraw that amount to use, in combination with the $50,000 allocated by the IDA in next year’s budget and $400,000 from the county’s general fund to make the $698,000 due for payment on the principal and interest on the $10.4 million bond.
The sum of those amounts would be about $10,000 more than needed, but Geddings didn’t say who would get the left-over money. BOC Chairman Melvin Davis, also an Authority member, said the county would pay what remained when other payments had been tallied.
The county borrowed $10.4 million to use to build the Caterillar plant and the infrastructure for it. The IDA owns the plant and land, and Caterpillar leases it, though it doesn’t actually make lease payments.
The money now in the infrastructure account is unused money from the bond.
From now until 2034, the county will be required to make a payment of about $700,000 each years, with payments in March and September, against that debt.
The total cost of retiring the $10,380,000 in debt will be $14,560,910.
Georgia House Rep. Chuck Williams, a member of the IDA, asked Geddings to review the details of the “revenue bond allocations” and followed with additional questions on the payment arrangements.
Asked For Details
During his subsequent member report, Williams, a Republican who lives in the south of the county, said the GDOT was moving forward with the widening of U.S. 441 from Watkinsville to Madison.
The project is expected to include a bypass of Bishop, but no route has been identified.
Williams said he and other legislators had asked GDOT to consider widening SR 15 from the Greensboro to Watkinsville.
He said he expected this project to involve turn lanes to accommodate the additional truck traffic on the route because of the deepening of the Savannah port.
The video of the entire discussion of the financial report and budget for the IDA is in the video below. The clip above was from this larger video.
The discussion goes in several different directions, including the discussion of SPLOST and of the financial needs of the IDA given its aspirations.
This is not dramatic viewing, but it contains a lot of important information about the IDA and some of its key members.
County Finance Director Wes Geddings said the Authority would need to start thinking about how it wanted to spend that money. Though SPLOST is, by name, for special projects, the county simply said the money was for “Economic Development Facilities” and left it at that.
Geddings, who also handles IDA finances,
Geddings also handles IDA finances?? That doesn't pass the smell test!!
It is not legal for a county or city to use SPLOST funds for anything other than a special project. If a county or city intends to use SPLOST funds to re-pay a bond, it needs to announce so in the legislation.
If Melvin, Geddings and Rick Waller (the IDA Chair who also does business with the county through his insurance business...conflict of interest?) are going to use SPLOST to pay for Caterpillar, if not illegal, they are at least circumventing the intent of SPLOST.
Taxpayers have approved SPLOST for road improvements, park improvements, facilities and equipment for public safety, etc. If Melvin, Geddings, and the other four commissioners told the public SPLOST would pay for the Caterpillar bond, would it have passed?
Another example of loose language giving carte blanche to those who have the power of the pen to sign checks.
Watch what happens to the billion dollars in new taxes coming out of the past session of the legislature. Money for them to distribute for friends, allies, and praise-mentions like this one for Chuck Williams.
"He got us some 'free' money? Ain't that grand?"
Agree that Geddings should not be handling IDA finances.
Are we the taxpayers funding the creation of good stable jobs or are we merely a vehicle to provide funding for CAT's and other heavlity subsidized corporations stock buyback programs? These -super secret,no one can know but EDA - esoteric taxpayer funded deals placing the taxpayers on the line as guarantor for a corporation's long term debt need some serious reevaluation, before we cross into an area of unserviceable debt that only can addressed in a municipal bankruptcy court a la' Birmingham Alabama.
CAT has been struggling for 28 months and only has been able to keep it's share prices up via stock buybacks with borrowed money...and how much of that was redirected taxpayer money?
This is what we've gotten:
Trapped In A Bubble
For this:Parent Company Summary
Parent Company Name:
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