Council prepares to present request for depot 12/15/2009 12:42 AM By APRIL BAILEY Staff writer
The City of Aiken will move forward with drafting an ordinance to be presented to City Council members for a $1.3 million loan request for Aiken Corporation for the Aiken Railroad Depot. Council has not yet approved the loan; the ordinance will be heard by Council for its first reading in January. In September, Aiken Corp.'s board of directors voted to request the money from the City to pay off the interest on a loan Aiken Corp. has with Security Federal Bank, as well as completion of dioramas, architectural fees, completion of the first phase of railroad cars, displays, payment and the balance of a construction contract. Though the vote was unanimous Monday, several council members expressed concerns about asking City staff members to prepare an ordinance for consideration without more information about how much money Aiken Corporation has raised for the project and how the loan would be repaid to the City. Councilman Dick Dewar suggested a work session to gain more information about the project. He said a loan request for the Depot will likely lead to a request for one from the Center for African-American History, Art and Culture. "Whatever we do for one, we will be expected to do for the other," he said.
Council member Steve Homoki agreed that more details were needed before Council moves forward. "Seems to me the work is going to progress whether we approve this $1.3 million or work on it next time around," said Homoki.
Before approving the draft of the ordinance, Council members agreed that a work session will be held next month to answer Council members' question on the proposal.
Wade Brodie, chairman of Aiken Corporation said the non-profit group has raised $2.2 million in pledges and has about $1.1 million left to raise for the Depot. He said Aiken County has agreed to commit $500,000 to the project as well. According to Brodie, the group already has a line of credit in place to move forward with the project without a loan from the City, but said borrowing from the City will reduce its interest rate to 2 percent, saving Aiken Corporation about $52,000 a year, said Brodie. He said the City will also benefit from lending the money to the organization by earning 1 percent interest above the state's investment pool rate, which will amount to about $13,000 a year for the City, said Brodie.
The City has loaned money to the organization in the past. In 2000, the City loaned Aiken Corp. a construction loan of $3.5 million to build the Washington Center for the Performing Arts. The loan was later converted to a regular loan and extended through 2011. Aiken Corp. owes $2,250,000 on the loan for the Washington Center. The City has also loaned Aiken Corp. $20,000 to paint the spec building and $250,000 for work for housing in Toole Hill, Edgewood and Crosland Park.
Aiken Corp. will pay for the costs for the construction of the Aiken Railroad Depot, however once it is complete, the City will take over ownership of the facility. It will serve as the City of Aiken's welcome center and will hold offices for the City of Aiken Parks, Recreation and Tourism Department. The Aiken Railroad Depot is being built on City property.
Councilwoman Beverly Clyburn said the Depot will likely attract more business in the area once it's complete. "Once you start development and it takes hold, it will be an incubator for other business," she said.
In other action, City Council member Don Wells was chosen as the new Mayor Pro-Tem by Council members, beginning this month, through next December.
Contact April Bailey at abailey@aikenstandard.com.
Notice about comments:
AikenStandard.com is pleased to offer readers the ability to comment on stories. We expect our readers to engage in lively, yet civil discourse. AikenStandard.com does not edit user submitted statements and we cannot promise that readers will not occasionally find offensive or inaccurate comments posted in the comments area. Responsibility for the statements posted lies with the person submitting the comment, not AikenStandard.com. If you find a comment that is objectionable, please click "report abuse" and we will review it for possible removal. Please be reminded, however, that in accordance with our Terms of Use and federal law, we are under no obligation to remove any third party comments posted on our website.
Posted by: ELMER PYWICKET On: Wednesday, December 16, 2009 2:14 PM
Comment Title: JUST WHAT AIKEN NEEDS -- A NEW TRAIN STATION WHEN THERE ARE NO TRAINS
What's this I'm hearing?! Someone is actually making noises about trying to understand how this loan is going to be paid off? This is indeed an unusual concept. The depot is a brand spanking new edifice, a monument to a private-public "partnership" run amok. The other project mentioned -- the Washington Center for the Performing Arts has been an economic catastrophe -- which the involved principals tried their best to hide from taxpayer scrutiny. This new loan from the City will be used to pay off an existing loan from Security Federal Bank. The bank will be left holding the bag if enough money is not collected from pledges. The CEO and president of Security is Tim Simmons. Guess who's on the board of the Depot Committee? -- Tim Simmons. Guess who is the chairman of the committee raising money for the Depot? -- Tim Simmons. So, here we have a taxpayer funded government two-fur: 1. A white elephant building and old rail cars. 2. A bank bail-out. So, where are all of the right-wing-nut anti-government folk when you need them? Oh, they're busy collecting their bank stock dividends.
Report Abuse
Posted by: The Baron On: Wednesday, December 16, 2009 11:34 AM
Comment Title:
Mr. Homoki you were just elected by the people in order to stop this frivolous waste of taxpayer money. The city of Aiken is not a bank and in the business of providing loans and it certainly doens't need to be funding African Museums, this ridiculous depot or others wasteful projects. Councilwoman Clyburn is off her rocker if she thinks this depot is going to attract businesses to the area.
Report Abuse
Posted by: James B. On: Tuesday, December 15, 2009 12:16 PM
Comment Title: Misuse of Funds
I fail to see the logic behind wasting funds to stimulate business. I cannot imagine that a demographic inticed by a replica depot will produce capital for the city. If this is the best strategy the council can produce, perhaps it is time to elect competent officials that are anchored in reality instead of those that are willing to back a multi-million-dollar pipe-dream. This city has real problems with crime, education and overall infrastruture. Please focus on these issues or we will not elect you again.
Report Abuse
3