Most of the focus on financing a Barter Theatre expansion in Mount Airy has centered on local government funding and investment by private developers — but could the state of North Carolina also play a role?
That possibility was raised during recent discussions surrounding a decision by the Mount Airy Board of Commissioners to have a feasibility study done on the project, which a financial adviser for the city says could lead to state assistance.
The board voted 4-0 last Thursday night to allocate up to $15,000 for the study by the Development Finance Initiative (DFI) of the UNC School of Government in Chapel Hill. The DFI assists local governments in attracting private investment for transformative projects by providing specialized finance and development expertise.
It partners with communities on projects involving building reuse — which is the case with the Barter expansion eyed for the former Spencer’s industrial property in downtown Mount Airy. The DFI also is geared toward community development, downtown revitalization and economic development, which is the main thrust of the plans to redevelop the Spencer’s site with the theater as a centerpiece.
Doug Carter, who is providing financial adviser services to the city for the project as the result of an April 19 decision appropriating $100,000 for that function, presented information about the DFI feasibility study ahead of the 4-0 vote.
Carter explained that the main goal of the study will be to review numbers that have been presented for financing the Barter expansion, to “look at them a bit more broadly.”
The DFI will examine the tax impacts, local costs and other aspects of the plan, including those affecting the state along with Surry County.
That prompted Commissioner Jon Cawley to ask Carter if there was a reason for taking the broader, statewide outlook in addition to locally.
“The largest impact for the Barter will be for the state of North Carolina,” Carter responded regarding the 500-seat facility. Having that impact confirmed by an independent, highly respected resource such as the Development Finance Initiative also could result in some form of state aid for the project, he indicated.
Documents recently presented show that the state government would be the biggest beneficiary of one revenue source boosted by the Barter Theatre’s presence in Mount Airy: sales taxes. Most of the financial benefit from the project is to be realized through additional sales tax revenues, the documents state, 58 percent of which would go to North Carolina.
Such information was prepared through recent efforts that culminated with a unanimous decision by the city commissioners on Aug. 2 to proceed with a new financing concept for the Spencer’s redevelopment including the theater, expected to cost $13.5 million.
It shifts nearly all the funding burden to the private sector, specifically the developers of a four-star hotel also planned for the property which stands to profit most from the Barter. Efforts also have intensified to recruit Surry County government as a participant since it also would realize tax benefits.
Earlier plans called for the city of Mount Airy to assume most of the Barter burden, which was criticized by citizens and two of the commissioners. This approach also was rejected in March by analysts with the Local Government Commission in Raleigh, a state oversight agency whose approval is required for such projects.
Carter said the DFI study will provide solid information for the Local Government Commission to reconsider regarding the Barter’s viability in Mount Airy and hopefully win its approval for the project during a return visit to Raleigh.
The Development Finance Initiative at the UNC School of Government will be working in an expedited manner to meet timelines of the state commission and the private developers involved in the Spencer’s effort, according to Carter.
“They have promised to finish their study within 60 days,” he said. “Time is of the essence.”
Carter’s work as financial adviser appears to be winning fans among city officials, even those initially opposed to his involvement.
“I voted against you,” Cawley told Carter, referring to a 3-2 vote in favor of allocating money for the adviser services on April 19 in which he and Commissioner Jim Armbrister were the dissenters.
“I was just wrong,” Cawley said, explaining that his vote was not personal but reflective of his general distrust for out-of-town consultants.
Tom Joyce may be reached at 336-415-4693 or on Twitter @Me_Reporter.