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EDA-appointed negotiators to meet bank as Green Isle weighs options for school property tied to bond debt
Summary
EDA appointed two representatives to negotiate with the bank about the school building; six months of payments are covered through Nov. 30, but staff said sale or lease options would likely require bank sign-off because the building secures existing bonds.
The EDA has appointed Mark and Diane to negotiate with the bank regarding the school property, staff told the council on Oct. 8. Amy said she contacted the bank and informed it of the EDA appointments to begin discussions about potential sale or lease options. Amy said there is interest from a party to lease or purchase the building, but that conversations are in the preliminary stage.
Staff said a fund has money set aside to cover six months of payments on the bond; that coverage runs through Nov. 30. Beginning Dec. 1, the city would no longer have payments covered unless a deal or other funding arrangement is reached. Amy and the city attorney said they will examine the bond language and that the bank (bondholder) will likely need to sign off on any sale because the building secures the outstanding bonds.
The EDA recommended ending the contract with John Beny at the end of November; staff confirmed the contract is currently listed at $10 per square foot (advertised lease terms) and that the city will continue exploring options. Staff cautioned that selling the property would not necessarily eliminate bond obligations unless arrangements with the bank are reached.
No final sale or lease decision was made at the meeting; the council and staff said they will continue discussions with the bank and report back.
