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Leaders from Greenville, Ayden and county government are discussing if they should loan more than $230 million to the state to speed up work on the Southwest Bypass.
Pitt County Manager Scott Elliott updated the Board of Commissioners about the discussions during its regular Monday meeting.
Officials with the county, City of Greenville and Town of Ayden are exploring if the local community should loan $237 million to the state Department of Transportation so it can begin building the 11-mile, controlled-access highway that would link U.S. 11 South near Ayden to the U.S. 264 interchange at Stantonsburg Road.
The loan is called a grant participation note and under the legislation authorizing its use, the state repays the community, said Ray McIntyre eastern manager of the state Transportation Improvement Program.
Three communities - Cary, Wilson and Greensboro - have used this funding method, McIntyre said. The Cary project was the most expensive at $15 million.
The county and Greenville are meeting with attorneys and financial advisers to determine if this funding mechanism is viable, Elliott said.
"I'm very cautious about this whole project," Elliott said.
The discussion began because of local concerns about delays surrounding the project, Ayden Town Manager Adam Mitchell said.
"The schedule for construction kept getting pushed back further and further, and that became worrisome for officials in Pitt County," he said.
The state transportation department plans to build the Southwest Bypass in three phases. Construction is scheduled to start in 2018 and continue for at least a decade, according to state records.
Loaning the state money would allow the construction work to begin earlier and for a shorter period of time, Mitchell said.
"We obviously want to see the project built in Ayden and we want to see it built, sooner than later," Mitchell said. "Ayden has a lot to gain from the construction of this highway."
The bypass would allow traffic along southern N.C. 11 to travel to Interstate 95 without stopping for traffic lights, a transportation design desired by manufacturers, he said. Building the highway in phases prevents that uninterrupted travel.
The county, Greenville and Ayden don't have a spare $237 million, so the local community would have to take out a loan to pay the state.
Determining the community's responsibility for repaying that loan is one of the issues being investigated, Elliott said.
The county and municipalities have been assured the loan will be made based on the state's promise that the money will be repaid, Elliott said. The financial institution making the loan can't require the borrower to raise taxes to pay off the loan, he said.
However, there is a moral question about defaulting on a loan if the state didn't repay the money, Elliott said.
"They are trying to assure us that the state has our back and will reimburse us the cost of construction," Elliott said.
McIntyre said if the state agrees to accept the local loan it is agreeing to repay the money.
"I would say by us entering in this agreement we would commit to making the repayment to the local government," McIntyre said. "That is our commitment if we do enter in to this."
County staff is researching how such a project could affect the county's borrowing capacity and bond rating, Elliott said. They are gathering data about the state's repayment schedule.
Pitt County is making $169 million in debt payments for various capital projects. The county has a debt ceiling of $700 million but in order to maintain its AA bond rating the county shouldn't have more than $300 million in outstanding loans, Elliott said.
Greenville had $35 million in debt at the end of fiscal year 2011-12 and a debt capacity of $454 million. Ayden's debt capacity is $17.8 million, and it's paying off $5 million in debt.
Staff is consulting with the county's bond counsel and financial advisers to assess the viability of the project. Their support is mixed.
"It depends on whose counsel you talk to," Elliott said.
The City of Greenville has reviewed the proposal with bond counsel and legal counsel, and Greenville officials say they are comfortable with the proposal, Mitchell said.
Greenville City Manager Barbara Lipscomb said review of the proposal has started but did not want to discuss what the advisors were saying about the project.
Elliott said no timeline has been set for making a decision. However, action in the General Assembly last week is increasing the urgency.
The General Assembly approved legislation that will change the state's method of deciding what transportation construction projects are funded.
Any project that is not under construction by July 1, 2015, will have to be reviewed using the new formula, including the Southwest Bypass.
Local officials want assurances that if they loan the state money and construction work begins before 2015, the money will be repaid.
The state is scheduled to start right-of-way acquisition for segment C, the stretch between south of Forlines Road to U.S. 264 Bypass at Stantonsburg Road, in fiscal year 2013-14. An estimated $26.3 million will be spent on this project. Construction on this segment is scheduled to begin in 2018 and will cost nearly $21.8 million.
Right-of-way acquisition on segment B, south of N.C. 102 to south of Forlines Road, and segment A, N.C. 11 south to N.C. 102, will begin in 2017 and 2019, respectively. Construction on segments B and C will begin sometime after 2020.
I know we've wrote about it before, but the airport voluntary purchased two homes on Belvoir Road at the north end of the airport and 12 homes on Haw Drive. I don't recall a concrete number of purchases.
I assume the whole 670-foot addition will be completed by August 2015.
I used to work program development in the Pentagon, where BILLIONS were often chump change.
A very famous saying there, that had the additional advantage of being true is "Money talks, BS walks."
Putting money into the pot (or skin in the game) is a very effective way of talking LOUDLY, and I am sure, earn an awesome return on investment. Good Luck.
Leaders from Greenville, Ayden and county government are discussing if they should loan more than $230 million to the state to speed up work on the Southwest Bypass.
Pitt County Manager Scott Elliott updated the Board of Commissioners about the discussions during its regular Monday meeting.
Officials with the county, City of Greenville and Town of Ayden are exploring if the local community should loan $237 million to the state Department of Transportation so it can begin building the 11-mile, controlled-access highway that would link U.S. 11 South near Ayden to the U.S. 264 interchange at Stantonsburg Road.
The loan is called a grant participation note and under the legislation authorizing its use, the state repays the community, said Ray McIntyre eastern manager of the state Transportation Improvement Program.
Three communities - Cary, Wilson and Greensboro - have used this funding method, McIntyre said. The Cary project was the most expensive at $15 million.
The county and Greenville are meeting with attorneys and financial advisers to determine if this funding mechanism is viable, Elliott said.
"I'm very cautious about this whole project," Elliott said.
The discussion began because of local concerns about delays surrounding the project, Ayden Town Manager Adam Mitchell said.
"The schedule for construction kept getting pushed back further and further, and that became worrisome for officials in Pitt County," he said.
The state transportation department plans to build the Southwest Bypass in three phases. Construction is scheduled to start in 2018 and continue for at least a decade, according to state records.
Loaning the state money would allow the construction work to begin earlier and for a shorter period of time, Mitchell said.
"We obviously want to see the project built in Ayden and we want to see it built, sooner than later," Mitchell said. "Ayden has a lot to gain from the construction of this highway."
The bypass would allow traffic along southern N.C. 11 to travel to Interstate 95 without stopping for traffic lights, a transportation design desired by manufacturers, he said. Building the highway in phases prevents that uninterrupted travel.
The county, Greenville and Ayden don't have a spare $237 million, so the local community would have to take out a loan to pay the state.
Determining the community's responsibility for repaying that loan is one of the issues being investigated, Elliott said.
The county and municipalities have been assured the loan will be made based on the state's promise that the money will be repaid, Elliott said. The financial institution making the loan can't require the borrower to raise taxes to pay off the loan, he said.
However, there is a moral question about defaulting on a loan if the state didn't repay the money, Elliott said.
"They are trying to assure us that the state has our back and will reimburse us the cost of construction," Elliott said.
McIntyre said if the state agrees to accept the local loan it is agreeing to repay the money.
"I would say by us entering in this agreement we would commit to making the repayment to the local government," McIntyre said. "That is our commitment if we do enter in to this."
County staff is researching how such a project could affect the county's borrowing capacity and bond rating, Elliott said. They are gathering data about the state's repayment schedule.
Pitt County is making $169 million in debt payments for various capital projects. The county has a debt ceiling of $700 million but in order to maintain its AA bond rating the county shouldn't have more than $300 million in outstanding loans, Elliott said.
Greenville had $35 million in debt at the end of fiscal year 2011-12 and a debt capacity of $454 million. Ayden's debt capacity is $17.8 million, and it's paying off $5 million in debt.
Staff is consulting with the county's bond counsel and financial advisers to assess the viability of the project. Their support is mixed.
"It depends on whose counsel you talk to," Elliott said.
The City of Greenville has reviewed the proposal with bond counsel and legal counsel, and Greenville officials say they are comfortable with the proposal, Mitchell said.
Greenville City Manager Barbara Lipscomb said review of the proposal has started but did not want to discuss what the advisors were saying about the project.
Elliott said no timeline has been set for making a decision. However, action in the General Assembly last week is increasing the urgency.
The General Assembly approved legislation that will change the state's method of deciding what transportation construction projects are funded.
Any project that is not under construction by July 1, 2015, will have to be reviewed using the new formula, including the Southwest Bypass.
Local officials want assurances that if they loan the state money and construction work begins before 2015, the money will be repaid.
The state is scheduled to start right-of-way acquisition for segment C, the stretch between south of Forlines Road to U.S. 264 Bypass at Stantonsburg Road, in fiscal year 2013-14. An estimated $26.3 million will be spent on this project. Construction on this segment is scheduled to begin in 2018 and will cost nearly $21.8 million.
Right-of-way acquisition on segment B, south of N.C. 102 to south of Forlines Road, and segment A, N.C. 11 south to N.C. 102, will begin in 2017 and 2019, respectively. Construction on segments B and C will begin sometime after 2020.
Due to the lack of time I have to respond to this post, I haven't read the entire post; but nonetheless that's an interesting concept. Those loans could be extremely lucrative for the community, but dozens of risks come with it as well. Taking out a loan, for a loan seems a bit too risky for my likings, it could either benefit us because of the interest the DOT holds, or hurt us because the DOT can't make payments.
I'd rather allow Greenville to pass a bond measure that ECU, Vidant, locals, and etc. could pay into, while instituting a new 'local gas tax' which essentiallys adds a few cents on to gas for the sake of building the bypass and will be eliminated once a certain fraction for the bypass has been financed. From there, Greenville pass that cash on as a loan to the DOT, which in return pays for less on the bypass but could potentially owe Greenville and the southwest bondholders more money over a designated amount of time. Of course Greenville would need to take out a loan regardless, but it should be taken out if and only if Greenville can get at least 50% of the cash itself.
I would refuse to go to a bank for a $250 million loan that may never come back to me, I'd bring other people on board for this loan and give them certain benefits for it. Example, if Vidant invest $25 Million in Bonds it can have the road labeled as 'Southwest/Vidant Bypass'. Essentially what I'm saying is the bypass is needed, and although I'm not too in favor of it, if it does need to be built as soon as possible, lets not dig ourselves into a grave by financing it.
That is very interesting. Seems like there is a lot of contradiction. I believe the DR story.
They mentioned Asheville in the article, I guess visiting all of these different cities has opened Uptown Greenville's eyes about this revenue generator. Asheville has permits for outdoor seating based on the square footage of the area. They even have a $25 permit for those folding signs that restaurants put in front of their doors on the sidewalk to advertise their specials.
All in all, It's not a terrible idea, but I think that if they were going to implement this, all current businesses could get grandfathered in on a $50 permit. All new businesses would pay the $150 fee.
Last edited by michealbond; 06-26-2013 at 07:17 AM..
Old Police Chief could be in some hot water up in Asheville....so glad he moved on. I can only imagine what a mess the shooting would have been if the new chief wasn't here.
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