Here’s how Waynesboro City Council can close the deal on a proposed industrial park without breaking the bank. Three words, two hyphenated: low-interest, back-ended loan.
The idea – the city agrees to purchase the land, approximately 170 acres located off South Delphine near the Interstate 64 interchange at Exit 96, and the property’s owners, Afton attorney Roger Willetts and Staunton auto dealer Charlie Obaugh, agree to finance the purchase with a low-interest loan.
The loan would be structured so that the city wouldn’t pay its first payment on the loan until it had sold the first parcel in the industrial park. (Thus the back end.)
The rationale there: A city official told me last week that it could take five years just to get the property on the market in terms of having infrastructure (roads, water, sewer) in place.
(Contrary to assertions in local media reports that have claimed the property to be ready for development now. Far from it – we’re talking about land whose best current use is the planting and harvesting of soybeans.)
The advantages:
– The current owners no longer pay taxes on property that they have not been able to sell. They also find a buyer, which is not insignificant. One developer told me today that it’s his opinion that the property isn’t likely to sell at anywhere near its assessed value for 15-20 years.
– The city can begin in earnest to obtain help from the state (and as appropriate from Washington) to take care of infrastructure needs at the location. And it’s able to do so without having to assume the risk inherent in any speculative land-development deal. (Added bonus: We avoid having to go through the costly bond issuance process.)
– If all works out, the owners get their money back within 20 years, and the city gets new industries and thus jobs. (Likely also down the road, probably 10 or years more down the road.)
Column by Chris Graham
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Chris Graham
