Celina may borrow to buy lakeshore land

CELINA - City council members Monday night passed first reading of legislation to borrow additional money on behalf of the Bryson Trust Fund to finalize the purchase of two lakeshore-area properties.

But some councilmen questioned why the Bryson Trust Fund overseers, who committed to paying 90 percent of the acquisition, don't just write a check for the final payments to the owners of the Larbus property, which housed Versa Pak, and the Mercelina Mobile Court.

Earlier this year, the city applied its 10 percent contribution of $300,000 and borrowed $1.2 million from Mercer County toward a downpayment on the side-by-side properties. The total price is $2.2 million for the Mercelina land and $745,000 for the Larbus property. The city will convert the 8 acres into the Bryson Park District.

The new ordinance would borrow more and roll the existing debt into a one-year note of $2.64 million, likely to be issued by the county at 1.6 percent interest. Bids from financial institutions are due Feb. 11.

"These are always done as notes anticipating the purchase of bonds but these won't go into bonds," mayor Jeff Hazel explained. He compared the financing to that taken out for the West Bank walkway project. The city takes out a smaller note each year to cover the decreasing remaining debt on that project, he said.

The city needs to secure financing soon to close on the properties, Hazel said.

"We needed to do this now because the last of the gas lines got removed from the trailer court property so now that 30-day clock starts ticking on when we need to get payment made to finalize the purchase of that property," Hazel said.

Hazel stressed that the Bryson Trust fund will be responsible for all the principal, interest and other fees associated with the note. The fund, managed by First Financial Bank, has a balance of about $10 million, according to trust officer Carolyn Pancake.

"They had not determined exactly how they wish to fund this, whether it was reimbursement, whether it was writing a check," Hazel said.

The trustees have asked the state attorney general for opinions on how to make the final payment and if they can use the fund's principal, Hazel said.

"That is up to the trustees ... we don't control the trust, we don't control the trustees, we are the sole beneficiary to the Bryson Trust,' he said. "They are working with this."

Councilman Bill Sell, who noted a trustee in a September 2013 letter said the trust was committed to the project, asked if the trustees are unwilling to cut the check.

"I mean what's the holdup?" he asked.

"They are looking as to whether they cut a check for all or a portion or do a reimbursement for the payments and principal, interest and fees - that is what they're trying to get a decision from the attorney general's office on," Hazel said.

Sell said it appears the trust is going to reimburse the city if council approves the ordinance.

"The reason why this is coming up is because since we don't know how they're going to do it yet - I don't know how long it will take to come back from the AG's office," Hazel said. The trust will pay the expenses connected to the note if the city proceeds with the financing, Hazel said.

Sell asked if the city could end up solely responsible for the debt.

"In other words, even though Bryson has every intention of helping us with the $2.645 (million), is there a possibility that the attorney general will say, 'No, you can not because you're dipping into your (principal)?' "

Hazel said the trust will pay for the project, noting that the trust has used interest from the fund to pay for several projects including the Bryson Pool.

"To me, it's not a question of if, it's when and how," Hazel said. The trust has financed park projects by reimbursement, Hazel said.

"The trust itself cannot be a party to a loan, so they can't sign even though we're the sole beneficiaries," Hazel added.

"I was just assuming that they didn't want to wrap up all their money at one big chunk. They could make payments," councilman June Scott said.

Council members also talked briefly about a new committee that will meet to initiate ideas for what is tentatively called the Bryson Park District.

The Celina Parks Advisory Board, including community and civic organization leaders assembled by Hazel, will meet at 7 p.m. Wednesday on the second floor of the city administration building on Main Street. The meeting is open to the public.

The board will discuss potential uses for the property. Hazel has requested the board avoid sports-related proposals since the city is using hundreds of thousands of dollars from last year's state capital budget for baseball and softball field upgrades at Eastview and Westview parks.