Will County Back Bond for Local Business?

The question was posed during last week’s board of commissioners work session. During the session, County Attorney Philip Landrum III said the development authority has identified a tenant prospect for the old HD Lee plant building on Holly Street behind the Pickens County Middle School. The prospect is a local business called Restaurant Interiors Inc., or RI. Currently RI is under a temporary lease in the HD Lee Plant building. The company moved to the HD facility after outgrowing its previous location in the industrial park on Confederate Avenue. Over the last six to seven months the company has increased its staff from 15 employees to over sixty.

Through a series of financial and legal maneuvers, the development authority intends to issue a bond to help finance Restaurant Interior’s occupancy of the building. The building, though, has a debt against it of an excess of one million dollars.

“Community Bank of Pickens County,”

Landrum explained,

“would be the lender, for lack of a better word. Those bond proceeds would be used to pay off Stearns Bank (the previous holder of the note) and RI would step in and be the tenant under a lease with the development authority.”

But, Community Bank requests the county to guarantee the loan in a one bill pledge.

“There would be an intergovernmental agreement between the county and the development authority,”

Landrum said. He went on to explain that if RI for some reason could not make its payments the county would be responsible to make the payments for the company, either through the general fund or by levying one mil from taxpayers. Landrum, though, said the chances of a default are low at this time.

According to Landrum the development authority has reviewed RI’s finances and found them financially viable of a debt load. He also said the development authority has enough money on hand to make bond payments for several months, should RI default on the lease, as well as the note payments.

“If that fails,”

he said,

“that’s when the county will slip in.”

Landrum admitted the county’s weak finances and the risk involved, but asserted that the trade off is the potential of creating 100 jobs in an economy where jobs are hard to come by, he said.

Commission Chair Robert Jones also seemed optimistic about the company, noting that RI started out with only 10 to 15 employees and now has over sixty.

“Business for them is booming and they are trying to put people to work, but (the company needed) more floor space,”

Jones said. The other commissioners, however, showed more reservations. District One Commissioner Jerry Barnes noted the company’s website only shows two stores that RI has furnished: Bo jangles in South Carolina and Burger King in Miami, Florida—FYN discovered, though, that the RI furnished another store in Florida as well. And, District Two Commissioner Becky Denney asked if RI is an established company and about its upper management. In the end, consensus of the board was to get more information about the company before it renders a decision. As such, Chairman Jones requested financial information from the company via County Attorney Philip Landrum. Specifically, the county requested the company’s latest financial report and an analysis of the credit worthiness of the borrower.

“How the process works,”

Landrum said,

“is that you all have to sign a resolution and intergovernmental agreement with the development authority.”

The board of commissioners has scheduled a public meeting February 13th at 3:00 P.M. at the Pickens County Government Administrative Office, Suite 168 to further discuss the matter.