Loan for former Salisbury mall approved by state commission

Published 12:10 am Wednesday, May 6, 2015

The Local Government Commission on Tuesday approved a $3.95-million loan to replenish Rowan County’s fund balance and pay for renovations at the former Salisbury Mall.

The state commission — a financial regulatory agency — approved the loan after lengthy discussion among commission members and statements from County Manager Aaron Church and local attorney David Shelby, who is a member of local political group La Resistance. The state commission also received a thick packet of information from La Resistance.

The state commission also considered a bond refinancing that passed without any discussion, other than a brief description of the project.

When the commission asked Church to describe the loan for the former Salisbury Mall, now called West End Plaza, he spoke briefly. Church cited a 5-0 vote by county commissioners to approve the loan and said “the county is in full support” of proceeding with the measure.

The mall loan previously came before the Local Government Commission in 2014. At the time, the commission asked Rowan County to delay the request until after November 2014’s election.The $3.95-million loan includes money to replace what commissioners took from the county’s fund balance for the late-2013 purchase of the mall and $500,000 for renovations.

The loan is identical to one previously submitted, except for the interest rate, which is lower than the previous proposal.

While speaking in opposition to the loan proposal, Shelby said it didn’t meet requirements of being necessary or expedient. Shelby called the loan a mortgage on the mall.

“There is no end to be accomplished by this financing,” Shelby said. “The county has gone for 18 months without replenishing its coffers.”

He cited the large amount of flex space shown in the county’s recently presented master plan for the mall as being a sign that no firm plan exists for about a third of the 320,000-square-foot facility. He also quoted previous statements from Finance Director Leslie Heidrick saying Rowan County wouldn’t need the loan, but it could help prevent bond rating decreases in the future.

The Local Government Commission discussed the timeliness of the loan briefly and quizzed Shelby on La Resistance, asking if the group’s primary purpose was to fight the West End Plaza project. Shelby responded that the group was formed in opposition to the Rowan County Tea Party.

Members mentioned political controversy that occurred shortly after the former mall as having an effect on perception of the facility. Otherwise, a commission member said, the loan was routine, considering the fact that the facility would be used for county office space.

With its passage, the loan, including interest and principal, will be $4.4 million. It would be paid off over 10 years.

The bond refinancing was for a 2005 $21 million bond used for school system improvements. It would save county government approximately $1.4 million, according to county documents dated March 5. Rowan County Commissioners approved an application to the Local Government Commission for the refinancing on March 16.

Contact reporter Josh Bergeron at 704-797-4246.