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Lamar approves economic development agreement to cover interest payments on LBIC loan for proposed commercial park
Summary
Council approved a development agreement to pay interest on a loan secured by the Lamar Business and Industrial Corporation (LBIC) for purchase of 35 acres; administration said the city’s maximum financial exposure is $210,000 annually for two years and staff described developer interest but no commitments.
Lamar — The Lamar City Council voted June 3 to approve an economic development agreement under which the city will make interest payments on a loan secured by the Lamar Business and Industrial Corporation (LBIC) for purchase of 35 acres at the Key Avenue and 20 Fourth Street Southwest intersection.
Administration recommended approval of the development agreement; meeting materials list the financial impact as a maximum of $210,000 annually for two years. The agreement follows the council’s March 18 action to enter into the loan arrangement and returns the final development agreement for council approval.
Council members pressed administration for details about the city’s recourse if the LBIC does not complete development within the two-year window. A staff member identified in the meeting as Mark said the city will secure a mortgage interest in the real estate; the city will not be in first position (a bank may be ahead), but the city would hold a secured interest and could extend the agreement or call the loan due and pursue foreclosure if necessary. "We will have a secured interest in the real estate," Mark said. He added that if the city were required to pursue foreclosure and took possession, it could resell the property.
Mark described outreach to potential developers and users: ISG is working on park design; he has met with three hotel developers, one of whom has been put in contact with ISG to discuss potential siting and acreage needs; he has also spoken with a fuel-station provider and shared topography and engineering information; he said there are no commitments yet from developers. "I have gotten one of the three developers who's expressed the most interest in touch with ISG to talk about ... where are you going to locate?" Mark said.
Council members urged administration and the LBIC to "hustle and perform" and noted the need to hold LBIC accountable to the two-year timeline. One council member said the funds are not gone but will be repaid from the LBIC arrangement.
After discussion, the council approved the economic development agreement by motion and voice vote; the presiding officer announced the motion carried.
The agreement moves forward development planning for the 35-acre site but does not guarantee developer commitments; materials and staff comments indicate outreach is ongoing and future site-specific negotiations will be required.
