County to pay fairgrounds loan
Haywood County commissioners will be stepping in to save the county’s fairground from the bank’s clutches after a vote at their Monday meeting.
The fairgrounds have two loans taken out on their buildings, and since the county slashed the $150,000 annual stipend it once gave the fairgrounds board several years ago, their ability to make payments has suffered. When a balloon payment for the remaining balance on the loans — just over $337,000 — came due in March, the fair board was able to work out a deal with the bank to make interest-only payments until Dec. 25 of this year. The plan, then, was for the county to step in, purchase the buildings and pay off the loans with 40-year USDA loan that they’d already applied for.
But when the federal budget stalled earlier this year, it put the brakes on USDA funding until a final version was passed that would lay out how much, if any, money would be available for cities and counties.
When it became apparent that this wasn’t going to happen in time to pay the fairground debt, county officials started devising an alternative plan.
First Citizens Bank, who holds the loans, couldn’t offer any more leeway to the fairgrounds board and there wasn’t enough money in the coffers to pay them. So they county has signed a memorandum of understanding with Haywood County Fairgrounds, Inc. to loan them the $337,100.59 for a principal payment, which they will hopefully recoup by receiving the USDA loan early next year to purchase the buildings outright. The county already owns the land they sit on. The fairgrounds board will pay the interest.
“In today’s world, we can’t just keep making interest payments, because the banks are accountable,” Commissioner Kevin Ensley told fellow commissioners. “We’re kind of in a tough spot because, by the end of this year, the bank will call our loan.”
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County Finance Manager Julie Davis said that the plan will work out nicely if the USDA money pans out, because at a 40-year amortization it will have a limited effect on the county’s budgets year-to-year. But, she said, not getting that funding isn’t out of the question.
“That’s a definite possibility,” Davis said. “The board has been thinking about that. We don’t have a plan at this point, but the options are that we do nothing or get a conventional loan,” which would be far more than they want to spend with the shorter terms on such loans.
For now, though, the fairgrounds are out of hot water and the county is keeping its eye on the USDA federal budget and its hopes up for a loan in the new year.
