However, CU General Manager Tom Wheeler, who also presides as chairman of the Cleveland/Bradley Economic Development Council, urged the entities to begin joint talks as soon as possible for at least two reasons.
One, Wheeler reminded all entities involved that the IDB’s purchase option on the parcel of south Bradley County property expires — at least, at the current price of $14,577 per acre — in October, at which time the CU leader believes the asking price will escalate.
Two, Wheeler stressed the total $6 million package will likely have to be financed and now is the time to explore bond issues because interest rates are low.
“It’s a good time to finance something that will bring more [money] back into the general fund,” Wheeler said.
The current offer on the table by Cleveland Utilities is that the local utility would guarantee $2 million of the purchase price, thereby allowing the Cleveland City Council and Bradley County Commission to assume a lesser $2 million debt as well. The original plan, as pursued by City Council earlier this year, was that the city and county governments each contribute $3 million.
The strategy stalled when county government leaders faced difficulty identifying funding sources; that’s when CU stepped up with its $2 million offer, which Wheeler stressed is not an outright $2 million check to the cause. Rather, it would be covered through a bond issue. In his words, Cleveland Utilities is offering to pay one-third of the debt service.
If the money is borrowed now, the CU debt service payments “... would be $50,000 per year for the first four or five years and then possibly increase to $150,000 per year to pay off principal,” Wheeler explained in Tuesday’s called session of the Cleveland Board of Public Utilities. He recommended the CU share — or debt service payments — be taken from the Electric Division which would constitute a range of .05 percent to .20 percent of the division’s budget.
Tuesday’s unanimous 5-0 vote by the utility board authorized Wheeler to attempt to negotiate a four-party agreement with city and county governments, and with the IDB which is chaired by Bradley County businessman Ross Tarver.
In his recommendation to the board, Wheeler stressed, “I am not asking you to write a check today for $2 million. I am asking for permission to sit down with city, county and industrial board representatives and see if a four-party agreement can be worked out to move the project forward.”
He added, “My proposal would be that we agree to finance one-third the debt of the $6 million needed to acquire the property.”
Plotting a strategy and ironing out individual responsibilities are the reasons Wheeler sees the need for representatives of all entities to sit down around the same table and develop a mutually agreeable plan. He said Wednesday that he does not foresee Cleveland Utilities as taking the lead role.
“We’ve got an offer out there,” Wheeler said of CU’s proposal. He confirmed that CU “stands good for a third of it [the property price].”
The County Commission’s latest action came Monday when members sent the proposal to its finance committee for review and a recommendation. Wheeler said Cleveland Utilities, like the City Council and IDB, will be waiting to see what direction the county’s finance committee takes.
Asked if CU might be willing to up its ante to $3 million with a like amount from the city in the event that county leaders can’t come up with their proposed share, Wheeler said he could not favor such a scenario.
“At this very second, I would not be supportive of it,” Wheeler said of a possible city/utilities dual partnership. “The players that are going to get the benefit [from a new industrial park] need to participate [in its acquisition].”
Any such joint action exclusively by the City Council and Cleveland Utilities would require Wheeler to re-approach the utility board, the general manager explained.
He added, “We’ve got to wait and see. If they’re (county) not going to be a player then we’ll have to figure out what to do next.”
As he has explained previously, Wheeler favors the Spring Branch site because it already has full access to CU’s infrastructure; in other words, it can be quickly serviced by CU water, sewer and electricity. A distant site such as one on Dalton Pike not already serviced by CU would cost the public utility “several million” dollars to develop new infrastructure, he explained.
Wheeler repeated past concerns — that successful industrial recruitment over the past few years has drained Cleveland and Bradley County of its supply of publicly owned property that can be used to entice future new companies. A city the size of Cleveland should have 400 to 500 acres of property at its disposal, he said.
Wheeler, who has been directly involved in economic development since 1974, said it’s an ongoing process that can’t be allowed to stagnate.
“[Economic development] is not the kind of endeavor you can get into and out of every year,” he said. “You’ve got to stay in the game.”
At Tuesday’s utility board meeting, Wheeler stressed, “You’re either moving forward or you’re going back.”