Tuesday, June 29th, 2010
Council acts on loan
Grand Lake Warehousing
By William Kincaid
CELINA - Council members on Monday night approved first reading of an ordinance to issue a $100,232 loan from the city's revolving loan fund to Rob Kraner to finance the purchase of 12.59 acres of city land in the Grand Lake Industrial Park.
The ordinance could not be approved as an emergency measure because of the absence of council members Myron Buxton and Angie King. Council members Bill Sell, June Scott and Mike Sovinski all voted yes, Jeff Larmore abstained and Ed Jeffries cast the lone dissenting vote.
Jeffries said he voted no because he questions the equity of the deal.
Council members already approved the land sale to Kraner to construct Grand Lake Warehousing, a 60,000-square-foot facility. The company also owns Celina Moving and Storage.
Council also has agreed to extend and realign Havemann Road into the industrial park for use by Grand Lake Warehousing and industrial park tenant Versa Pak. The $400,000 project will be funded with a $200,000 roadwork grant and $200,000 in matching funds. Celina Planning and Community Development Director Kent Bryan said the match will be paid through in-kind funds, meaning city crews and equipment will be used for construction, and funds from the Staeger Road Tax Increment Financing (TIF) fund.
Jeffries said he doesn't think the $400,000 roadwork investment is worth the $125,290 the city will recoup through Kraner's repayment of the revolving loan.
Celina resident Don Kohnen also questioned the land sale.
Initially, council members were given a proposal that included an option to sell Kraner the land for $10,000 an acre at zero percent interest. Now, Kraner is paying $100,232 for the land, which equates to $7,961.24 an acre, with interest at 2.41 percent for the loan.
The loan option on the land agreement includes a clause that mandates a total payment amount of $125,290, even if Kraner pays off the loan before 20 years.
Bryan said Kraner will pay the same out-of-pocket expenses, when interest on the loan is considered, as the $10,000-an-acre option at zero percent interest.
Jeffries also asked Bryan if the city has enough money in the Staeger Road TIF to pay for the improvements to the industrial park.
"There is currently, yes," Bryan responded.
The ordinance will be read a second time at a special meeting at 6:30 p.m. Thursday in the utility conference office.