Lenoir City Planning Officials Approve $2 Million Bond & Break Own Rules
At Lenoir Cityís Regional Planning Nov. 6th meeting, planning officials broke their own rules and set a precedent by granting the MIMMS Group their request to provide a $2Million bond instead of a letter of credit to guarantee improvements for The Market at Town Creek.
Kevin Sullivan with the MIMMS Enterprises Project said that he had supplied the planning office with numbers and they are anticipating close to $2 Million in bonds. He said that his company typically used A+ bond companies.
Sullivan commented how a letter of credit would restrict them to some degree from going after more projects. The MIMMS Group bought part of the Eldridge Farm property.
Newman said that typically bonds were not taken but admitted that they had not dealt with projects of this size where they required a letter of credit, close to the amount needed. He said what this would relate to, when a project site had been worked on for some time but the roads providing access to the lots, which were approved on the plat, and roads werenít done and utilities arenít there, in order for the planning office to sign off, that they required some security and MIMMS had requested the use of bonds in lieu of a letter of credit.
Newman spoke about the difference in a letter of credit, which was like cash in the bank verses a bond, which is only as good as the financial health of that bond company and that collections could be more cumbersome. Newman felt confident that they would perform under the plan but he wanted planning officials to be aware.
Sullivan said the project was very strong and they continue to lease with two more parcels under contract, both bank would close soon. He said that they had the resources to finish the project.
Terry Watson said that her company did work with the bond companies on the list and they were real good about dealing with claims.
Councilman Eddie Simpson said that he was concerned that they would be setting a precedent in approving the bonds and that there could be more in the future.
Newman said that if there were large projects that it could be used under those circumstances. Simpson said that he felt that documentation was needed in order to do that. Newman mentioned that they could change the regulations to allow bonds over a certain dollar value.
After a 10-minute discussion, Terry Watson made the motion in favor, seconded by Herb Lingenfelter, which was unanimously approved, Bill Ghormley, chair, Monty Ross and Councilman Eddie Simpson, voting on the motion.