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Wednesday, 23 December 2009 13:45

Safeguarding the settlement

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A cash settlement with the federal government in lieu of the long-promised North Shore Road will reap annual dividends for Swain County for years to come.

The county will put the money in a lockbox and only use the interest each year. In fact, the county couldn’t tap the principal even if it wanted to without permission from a two-thirds majority of all county voters.

Last year, the county created a trust fund to safeguard the pending windfall with the North Carolina State Treasurer. The state will remit interest off the account to Swain County, but the principal cannot be touched unless supported by a supermajority of registered voters in Swain County.

“Since by law only the interest income can be spent, the county will have a source of income forever. Therefore every citizen of Swain County will benefit,” Douthit said.

The government will pay $4 million into the account immediately. The remaining $8.8 million will be released 120 days after a final settlement figure is agreed on.

The state’s investment vehicle has performed well. It reaped an average 6.2 percent interest over the past five years, according to the N.C. State Treasurer.

Interest on the $12.8 million would be close to $800,000 annually, based on the average interest rate of the past five years.

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