Local fears fueled state denial of Barter deal

By Tom Joyce - tjoyce@civitasmedia.com
Cawley -
Armbrister -

The two members of the Mount Airy Board of Commissioners who voted against a city agreement with Barter Theatre say a state rejection of it reflected what many local critics already knew:

Expanding the Abingdon, Virginia-based theatre to Mount Airy represents too much of a financial risk for the municipality.

“You want to say ‘I told you so,’ because to me it’s been obvious,” Commissioner Jim Armbrister said Tuesday of ongoing monetary concerns surrounding the project which were reflected in a preliminary denial decision by the state’s Local Government Commission.

“But I’m not going to do that,” added Armbrister, who on March 1 voted against the city pact with the Barter along with Commissioner Jon Cawley and was on the losing end of a 3-2 decision.

Cawley, and other citizens, also had questioned Mount Airy’s ability to pay for building the theater on the city-owned former Spencer’s property being redeveloped, which a subcommittee of the Local Government Commission in turn was concerned about.

“It seemed like they asked some of the same questions many of our people were asking — and they didn’t like the answers,” Cawley said of the state group that posed a regulatory hurdle to the plan.

Cawley and Armbrister were reacting Tuesday to a disclosure made after a closed special session attended by local officials Monday afternoon in the wake of a meeting held Thursday in Raleigh between city and Local Government Commission representatives.

The Local Government Commission is a division of the state’s Treasury Department. It must approve all borrowing and financing by localities such as Mount Airy, which represents a checks-and-balances evaluation for projects such as the Barter expansion.

Establishing the 500-seat Barter Theatre requires borrowing about $7 million on a long-term basis, among other financial obligations.

Early stage rejection

While plans such as the Barter project must gain the approval of a Local Government Commission board, which seeks to ensure the soundness of such arrangements to avoid putting communities at financial risk, the process didn’t even get that far.

Armbrister said he and other Mount Airy representatives met for about four hours Thursday with the subcommittee of the state commission for a required pre-application screening.

Described by the city government as “non-biased,” it included Director of Debt Management Tim Romocki, Senior Financial Analyst Biff McGilvray and Financial Analyst Joe Futima.

The city learned then that the LGC staff has reservations about giving a favorable recommendation for the Barter Theatre project, that it is too risky.

Armbrister says they were aware of a recent controversy that divided the community leading up to the March 1 vote about whether the plan would benefit Mount Airy, including its long-term tourism growth.

“I really feel like they had caught wind of a lot of this, and they were trying to save the city some money and not get in any deeper than they were,” said Armbrister. He made the trip to Raleigh because the subcommittee wanted to hear from a dissenting commissioner.

Others who went were Mayor David Rowe, City Manager Barbara Jones, Finance Director Pam Stone and Martin Collins, the city’s community-development director.

The state subcommittee seemed bothered about the 3-2 decision to approve the Barter agreement.

“That was one of the alarms that was set off,” Armbrister said.

Despite the financial concerns that he and others had raised, Cawley did not expect the subcommittee to take the position it did.

“I was really surprised — I thought they would just rubber-stamp it,” he said.

“I’m not happy it happened,” Cawley said of the latest development that has come on the heels of much effort and expense on the municipality’s part so far. “I always want to honor the will of the board, and in this case that doesn’t look like it’s going to happen.”

Still, the dissenting board member, who has criticized a lack of planning for the project and a sense of haste in approving the agreement, said the financial implications are hard to ignore.

“With the deal as it was presented, it was not a good deal for the city of Mount Airy and that’s what the LGC said,” Cawley commented.

“I think under different circumstances, our board would have handled it differently,” he said, “and I’m sure we would have had a better chance of the LGC approval, but that’s not the way it unfolded.”

Still a chance

There were questions Tuesday about whether the house lights have dimmed forever on the local Barter project or there is still a sliver of hope for the development.

The municipality’s official position, based on a statement from the city manager, is that it “will be evaluating the next steps.”

“No, I don’t think that’s the end of it,” said Mayor Rowe, who acknowledged that he was “crushed” by the LGC subcommittee’s position on the matter.

“The Local Government Commission is a tough sell,” he said. “They leave no stone unturned, so to speak.”

Commissioner Steve Yokeley, a fervent supporter of the Barter Theatre plan, also reacted Tuesday to the setback.

“I‘m very disappointed, as you might imagine,” Yokeley said.

Since he did not attend the meeting in Raleigh, the Barter supporter has only heard about its content second-hand and would like to get a fuller picture of what was said and the LGC’s concerns.

Yokeley said one thing he does know is that mention was made by subcommittee members Thursday of the Randy Parton Theatre, a failed facility in Roanoke Rapids which was developed more than 10 years ago with that municipality footing the bill.

“I think that’s totally false — I don’t think this is anything like the Randy Parton Theatre,” Yokeley said of the project in Mount Airy.

Mayor Rowe indicated that the city government might try to revamp its financial planning to make the project more appealing to the state entity. “I would like to revisit it in some way, if we could figure out the LGC.”

Yokeley doesn’t believe its subcommittee had all the information needed to consider the project fairly. “I think we need to go back to the Local Government Commission and be better prepared.”

City officials recently approved a $100,000 funding allocation for a financial adviser who, among other services, was to guide the city through the LGC regulatory process.

“With the proper paperwork, it can still go to their board,” Armbrister said.

“I think we need to have a meeting as soon as possible and see where we go from here,” Yokeley said.

Both Armbrister and Cawley believe that even without the Barter component, the Spencer’s project remains viable overall, and two other facets of the redevelopment, a four-star hotel and apartments, will occur as planned.

Armbrister sees the denial of the Barter project as an opportunity for Mount Airy “to get a more solid deal.”

And Cawley thinks the board’s next decision will involve trying to find something else to go on the site intended for the theater.

“Those interested, contact the city ASAP.”

Cawley
https://www.mtairynews.com/wp-content/uploads/2018/03/web1_Cawley-for-mug-2.jpgCawley

Armbrister
https://www.mtairynews.com/wp-content/uploads/2018/03/web1_Armbrister-mug-2.jpgArmbrister
Opponents say commission recognized risks

By Tom Joyce

tjoyce@civitasmedia.com

Tom Joyce may be reached at 336-415-4693 or on Twitter @Me_Reporter.

Tom Joyce may be reached at 336-415-4693 or on Twitter @Me_Reporter.