ROCKINGHAM ― Mayor Steve Morris had a bit of paperwork to sign following a special meeting Thursday evening after the City Council approved a resolution to accept the conditions set forth by the USDA on a permanent financing loan for the Richmond Community College downtown campus.
The vote was unanimous with Councilman John Hutchinson giving his “aye” over the phone.
Larry Sampson, a loan specialist with the USDA, rapidly went over the conditions for the $6.75 million loan which the city will have to pay back over a 25-year period at 3.875 percent interest. Sampson said if interest rates decrease during the span of the loan, then the rate will also. However, the loan rate is locked at 3.875 percent and will not go any higher.
If the deal for the campus closes by May 1, 2019, then the first payment will be due the following year.
Earlier this month, the council approved interim construction financing with BB&T at 2.64 percent interest up to 14 months.
At the end of the 14 months, City Manager Monty Crump said, the city will close the interim loan plus interest and the USDA will take up the permanent financing.
“It’s complex,” he said. “We’re borrowing that money, but in the end of three years, we’re only going to owe 2.5 million dollars for a 12 to 13 million-dollar project. If you can find a better deal going on, I want to know where it’s at.”
Sampson said by getting the USDA Rural Development loan with the locked interest rate, the city will be “able to grow and do other stuff in the future. Whereas, if they went to a bank and got stuck with a short-term loan with a high interest rate, it limits what they can do in the future. This kinda helps the city put this building in here and grow.”
Both financing agreements have to approved by the Local Government Commission.
Also at the last meeting, the council awarded the $11,521,000 construction contract to John M. Campbell Company out of Union County.
The total cost of the project is set just more than $13 million, with a large portion of the tab being paid through grants.
The council has been excited about this project since first announcing plans to build a satellite campus on the site of the former R.W. Goodman and Long buildings.
Morris said Thursday that the new campus will “expand the educational opportunities for the kids in the Sandhills area,” with Crump adding that it will bring more traffic downtown and hopefully spur economic development downtown.
“If you look at Discovery Place Kids, eight new businesses have located around it since it’s been there,” Morris said. “We anticipate similar, or even better, development (with the college.)”
A groundbreaking is scheduled for 10:30 a.m. Sept. 24 on the corner of Lee and Franklin streets.