Oconee County officials are still waiting on Presbyterian Homes to indicate how much money it wants the county to borrow through bond sales to help finance construction of its Presbyterian Village Athens on U.S. 441 at Hog Mountain Road.
In the last two weeks the company began land clearance and construction of a chain-link fence along U.S. 441 for its complex. The county had issued a Land Disturbance Permit for the 79-acre property nearly a year ago.
The chain link fence is covered with signage promoting the Continuing Care Retirement Community, but county code enforcement officials say those signs will have to be removed because they are in violation of county code.
Rick Waller said at the meeting of the county’s Industrial Development Authority on Monday that the county has not received the documents from Presbyterian Homes that are needed for the Authority to move forward on the bond sales. Waller is chair of the Authority.
The Authority in May passed a resolution “preliminarily approving” the issuance of revenue bonds for Presbyterian Homes pending receipt of further documents specifying, among other things, the amount to be borrowed.
The resolution states that the Authority will need to pass “a Bond resolution approving such documents” before the agreement is final.
Waller’s update on Presbyterian Homes was in response to a question from Tom Remar, 1521 Crystal Hills Drive, made during the citizen comment section of Monday’s Industrial Development Authority meeting.
|New Fence And Advertisements On U.S. 441|
Remar said that he and others, particularly in the Crystal Hills subdivision behind the Presbyterian Village, are “real concerned” about the county’s role in the financing.
Remar said that the fear is that the citizens of the county “are going to be stuck” with paying off the money that the county borrows and then lends to Presbyterian Homes if that company runs into financial difficulty.
Waller responded that, “In this particular case, we’re simply acting as a pass through entity.”
“We’re not liable for anything,” Waller said. “Presbyterian Homes is liable through their assets for the value of the bond.
“Now if they went into default in some ways, in other words, all of Presbyterian Homes, we may have an issue,” Waller said. “But otherwise we’re not liable for the bond.”
Remar pushed Waller for documents regarding the bond sales.
“They have not come back to us with what is called a Bond Resolution,” Waller said. “We don’t know if they are going to want to finance the entire amount that they originally asked for, or some lesser amount, which is most likely the case.”
“There’s got to be something,” Remar said, noting that the Authority had approved a resolution back in May in response to the request by Presbyterian Homes.
Waller asked County Clerk Kathy Hayes to make that resolution available to Remar.
The resolution, which County Clerk Hayes made available to me on Tuesday, is part of an eight-page document signed by Waller and Alex Patterson, vice president of Westminster Presbyterian Homes Inc. of Quitman, in the south of the state.
The document states that the county is willing to issue 2018 revenue bonds in an amount up to $150 million “to finance, in whole or in part” the Presbyterian Homes project in Oconee County.
The county will lend the proceeds of the sales of the bonds to Presbyterian Homes and enter into a Borrower Agreement determining how Presbyterian Homes will pay the county for the loan.
The document states that the county has a right to hold a public hearing on the bond sales before they are issued and, if the county does not deliver the bonds in two years, the agreement is cancelled.
Oconee County Board of Commissioners Chair John Daniell, a member of the IDA, told Remar that “The documents are being drafted at this time to be presented to the county.
“We’ve not approved,” he said. “All we did was say that we would be willing to entertain them coming back to us to proceed to make the negotiations start.”
“We’ve not received any communication back from Presbyterian Homes one way or the other” since May, Daniell said.
Remar used the figure of $115 million as the amount requested by Presbyterian Homes when he raised his concerns, and Waller did not correct him, saying the Authority does not know the final figure.
I mistakenly used the $115 million figure in a post I did on June 10 on the May 14 meeting, and that could be where Remar got his estimate.
I was in the hospital at the time of the May 14 meeting and could not attend. Sarah Bell did attend and sent me the video and a note saying the request was for $150 million.
From the video it is clear that Jerry Peterson, bond counsel for Presbyterian Homes, used the figure of $150 million in the presentation on May 14, but, at one point, he seemed to say $115 million and also used the figure of $140 million.
Peterson also said the company has a loan commitment of $40 million from the United States Department of Agriculture.
The document released by Hayes makes it clear that the working maximum figure was $150 million and that is the figure I should have used in the original story.
During that May meeting, Jim Woodward, local bond attorney for the county, said “we have zero obligations as the Authority to make any payments whatsoever” on the bonds, and the same applies to the county.
Benefit To Authority
The resolution signed by Waller states that the Authority wants to assist the nonprofit Westminster Presbyterian Homes Inc. because it will “promote and expand for the public good and welfare industry and trade within Oconee County and reduce employment.”
At the July meeting of the Industrial Development Authority, Waller stated another justification for going forward with the project.
Waller said the Authority can charge a fee, set by the United States Internal Revenue Service, for administering the bond sales.
“I forget exactly what that is,” Waller said. “But because of the size of the bonds, it will be a fairly good income stream for, you know, the period of the bond. But since we don’t know the amount of the bond, the final amount of the bond, we don’t know exactly what that is.”
County Attorney Daniel Haygood told me in an email message today (Wednesday) that the Authority can charge one-eighth percent per year of the face amount of the bonds.
If the bonds are for $150 million, by Haygood’s calculations, this would amount to $187,500 per year.
Haygood said he has no way of knowing the number of years of the bonds “until we hear from PH and their finance folks, but I think we can assume five years until we hear differently.”
Fence And Signs
Last week I asked Guy Herring, director of Oconee County Planning and Code Enforcement, about the work underway at the Presbyterian Homes site. Herring told me on Monday that the Land Disturbance Permit had been issued.
The permit, which I have received, was issued Sept. 21, 2017, and is only for clearing and grubbing.
The permit states that “No grading or clearing for construction of streets, utilities, or storm drainage shall commence until after approval of the site development or subdivision construction plans by the Development Review Committee and the Planning Department.”
Oconee County’s Development Review Committee approved the preliminary site plan for the project in March of 2017 and was told that construction would get underway in the summer of 2017. The Review Committee has not acted on any plans from Presbyterian Homes since that time.
Herring told me in an email message this (Wednesday) morning that Presbyterian Homes “has been told the sign has to come down.”
Herring said Presbyterian Homes has received a “house moving permit” for the 4-acre tract it purchased on Hog Mountain Road. I have not yet received a copy of that permit.
I did attend the meeting of the Industrial Development Authority held on Monday at the Watkinsville Office of the Oconee County Chamber of Commerce.
Remar began his comments at 9:18 in the video below of the entire meeting.