Funding approved; Lake Gaston project ‘on hold’

Published 4:27 pm Friday, December 6, 2019

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JACKSON – A second public hearing to discuss Northampton County’s Small Business Loan Program was held here on Dec. 2 before the start of the regular Board of Commissioners meeting. While the first hearing in mid-November focused on approving the guidelines and application for the new program, this most recent one focused on funding.

In the original proposal, the county would have secured a loan from a third-party bank in order to initially fund the program whose purpose is to provide loans to new or expanding small businesses in Northampton County.

Instead, the proposal at Monday night’s public hearing was to use a county appropriation of up to $500,000 from the General Fund.

“This means we’re not borrowing money. We’re using our own money,” explained Board Chair Charles Tyner.

County Attorney Scott McKellar added that further research showed taking out a loan would not be “feasible” at this time. Many other counties in the state, such as Mecklenburg and Dare, who have similar funds also initially funded their programs with a county appropriation.

“It was determined this was the cheaper alternative,” McKellar said. “It would save the county a great deal of cost in interest that could cost the borrower more and the taxpayers more.”

The attorney also noted the Local Government Commission had approved the appropriation proposal.

The floor was opened for public comment from citizens, but no one chose to speak.

Since there was no further discussion, Commissioner Geneva Faulkner motioned to approve the change in program funding, and then made a second motion to appropriate up to $500,000 from the General Fund. The first motion was seconded by Commissioner Joyce Buffaloe and the second by Commissioner Nicole Boone. Both passed unanimously.

The News Herald confirmed the funds will come specifically from the General Fund’s Fund Balance.

As previously reported by the News Herald, the Small Business Loan Program is similar to the county’s existing Revolving Loan Fund Program in that they both help support small businesses that may not be able to receive loans from traditional sources. The new program, however, is different in that recipients are less restricted in the ways they can use funds.

Through the new program, the county hopes to achieve a number of objectives including reducing unemployment by increasing job opportunities, increasing the county’s tax base, redeveloping vacant land or blighted building areas, attracting other sources of capital, stimulating private sector capital formation, providing capital for manufacturing and service industries, and aiding minority- or female-owned business development.

Loans can be made for an amount up to $100,000 and for a term up to 10 years. All loans will be secured by real or personal property collateral as deemed appropriate, and payments begin up to six months after the loan closes.

At the end of the commissioners’ regular meeting, Tyner again emphasized the importance of encouraging small business growth for the county, noting that it’s a part of the strategic plan the commissioners developed earlier this year.

Tyner also said, however, much of the rest of the strategic plan—including the Lake Gaston project—would be put on hold while the commissioners focused on gathering a $5 million match required for a grant recently received by Northampton County Schools. In November, the school district received notification that they had been awarded $15 million for new school construction from the Needs-Based Public School Capital Fund.

“In order for us to get the $15 million, we’re going to have to come up with $5 million,” Tyner explained.

He also stressed that they were committed to gathering the money without having to raise taxes for Northampton citizens.

“Small businesses, we’ve got to have. Everything else [on the strategic plan] is gonna be placed on the backburner,” he concluded.