Commissioners to consider $6.5 million loan for downtown central school office

Published 12:00 am Sunday, January 4, 2015

When the Rowan County Board of Commissioners meet Monday, it could solidify the largest piece of funding in a nearly $8 million proposal to build a downtown central school system office on North Main Street.

Rowan County government received three loan proposals in mid-December. All three are for $6.5 million, but include different interest rates. The proposals came from First Bank, SunTrust Bank and Regions Bank.

Commissioners on Monday will first have a public hearing on the loan proposals and could approve a proposal immediately after. Before the loan is finalized, it would also have to receive approval from the Local Government Commission.

First Bank’s proposal included two different options. One option included a 3.55 percent per year interest rate. The second option included a 3.95 percent per year interest rate. Both of First Bank’s options would require refinancing after a specified period. The first option’s period before refinancing would be 48 months. The second option’s period would be 72 months.

Rowan County’s initial goal was to secure and approve a loan without a variable interest rate, said finance director Leslie Heidrick after opening the three loan proposals. In other words, the county sought to maintain the same interest rate from Feb. 12, 2015 — its projected closing date — to 2030 — when loan payments are scheduled to end.

The proposal from SunTrust Bank also included two different interest options, which were 2.48 percent and 2.83 percent.

The third proposal, from Regions Bank, has an interest rate of 2.68 percent.

In a staff recommendation, Rowan County’s finance department recommends approval of SunTrust Bank’s loan proposals at the lower interest rate of 2.48 percent, which would result in $1.32 million in interest. If SunTrust’s loan is approved, the total financial package would be about $7.82 million. Other funding sources for the Rowan-Salisbury School System central office include the city of Salisbury, which has pledged $500,000, and $150,000 in in-kind services, the Robertson Foundation, which pledged $850,000, and $150,000 from philanthropist Fred Stanback.

Repayment of the loan would be funded through tax dollars specifically earmarked for school system capital improvements. More specifically, the tax comes from amounts allocated through two half-cent taxes.

If the Rowan County Commissioners approve a loan on Monday, County Manager Aaron Church said the approved proposal would immediately be mailed to the Local Government Commission — a financial regulatory agency for local government entities — with the hope that the LGC would put the proposal on it February agenda. Church said the time between when commissioners meet and the LGC meets could result in the loans LGC consideration being delayed until March.

Other items on the commissioners’ Monday agenda include:

• A closed session

The closed session will include discussion on four different items, according to Monday’s agenda.

The four items are: disposition of a property located at 418 South Carolina Avenue in Spencer, an economic development matter regarding the Rowan County Airport, personnel and approval of the Dec. 1, 2014 closed session minutes.

• A Rowan-Salisbury School System request to purchase a property at 516 North Main Street

The property is 0.209 acres, according to Monday’s agenda. The property is adjacent to the school board’s existing space for the central office.

Its purchase would be paid for in conjunction with Richard and Debbie Monroe, who are married.

The purchase has already been approved by the Rowan-Salisbury Board of Education.

• a resolution for emergency repairs at St. Matthews Church Road on High Rock Lake.

The road’s bridge over high rock lake has been closed because of the road’s quality.

The resolution, one the commissioners’ consent agenda, asks for immediate assistance, even if its only temporary, to reopen the road.

• Approval of a capital building project for the South Salisbury Fire Department

The new facility would cost $1.35 million, according to Monday’s agenda. It would be paid for through a loan.

Agenda documents for Monday’s meeting don’t list the exact location of the new fire facility.

• A conditional use permit that would allow Robert Severt to build a 2,040 square foot storage facility on the 8600 block of Old Beatty Ford Road.

Monday’s agenda state that Severt plans to build the storage facility for personal belongings and construct a single-family dwelling at a later date.

• The Rowan County Department of Social Services hiring an additional person in Child Protective Services.

• Setting a date for a Board of Commissioners retreat

All of the proposed dates for the retreat are in February. The retreat would last two days.

Contact reporter Josh Bergeron at 704-797-4246