By MELINDA J. OVERSTREET
for Glasgow News 1
Members of the Glasgow Common Council unanimously approved a resolution at a special meeting this week meant to assist an industrial business in its effort to develop a facility here.
In August, the council agreed to the issuance of an industrial building revenue bond that was acquired by Sharp Carts Real Estate Holding LLC, according to that resolution.
Up to $15 million in such bonds was authorized on behalf of Sharp Carts, with the aim that it would occupy the last available space in Highland Glen Industrial Park off New Bowling Green Road just west of Veterans Outer Loop.
It was anticipated, though, that the amount needed would be closer to $6 million, said City Attorney Rich Alexander at that time.
The city leased the facility – an industrial speculative building, the shell of which already had been constructed – to Sharp Carts LLC, a subsidiary and affiliate of the bond holder, which produces shopping carts and related products to retailers.
Sharp Carts intends to acquire “additional equipment and personal property not financed with the proceeds from the bond,” according to the resolution approved Tuesday, and has made arrangements for a loan through Export Development Canada to finance thes acquisitions. Export Development Canada requested that the city approve an agreement essentially stating that, if Sharp Carts should default on that loan, the city would not seek to place a lien or hold on the equipment and other property purchased via that new loan, which becomes Export Development Canada’s collateral on that loan. With approval of the resolution, which was unanimous among the eight council members present, the agreement was adopted. Councilman Freddie Norris was absent from the 9 a.m. meeting.
Councilman Terry Bunnell asked questions about the wording of the resolution/agreement, voicing concern that, should Export Development Canada need to reclaim that equipment that, for example, may be bolted to the floor, it could do so in a way that would leave the property the city leases in a poor state, and he wanted to make sure the city had legal recourse if that happened.
The additional lessor’s agreement approved Tuesday has a provision that requires the lender to “promptly repair or remedy any damage … caused by the removal of the collateral” by the lender or its representatives.
Bunnell wasn’t certain that was sufficient in terms of what would happen if they did not abide by that obligation.
“I’m looking for some more assurance that will make us whole; that’s my only concern …,” he said. “Hopefully we won’t have to have any issue here with it.”
Councilman Joe Trigg asked about the original lease agreement and whether Sharp Carts was liable for damages, and Alexander said it is.
Councilman Patrick Gaunce said he believed Bunnell made “a great point” but the city is at a point it needs jobs.
“We need this company to show up,” he said.
He said he believed the economic benefit would be worth the risk of having to finish out the building again.
Bunnell said he would like to see them have “good correspondence with the bond company or file a second lien on the equipment so that that lender understands that they have a duty to the city.”
He continued that if the situation had arisen that Sharp Carts defaulted on its loan with that organization, that would mean it’s gone out of business and therefore wouldn’t have the funding to cover any damage itself. He said he hoped none of them ever got to that position.
“My issue is not with Sharp Carts; it’s with the lender,” Bunnell said.
Mayor Henry Royse said that ultimately, it would be up to Sharp Carts to make things right with the city.
Gaunce, inserted that, “Guys, we’re dying in this community, and if we make it too hard to get in here, I’m not worried so much about Sharp Carts as I am the next one that comes in and goes 25 miles down the road to the transpark,” and he reiterated that the jobs were more important than getting that wording changed.
“I would not let that stumble me,” he said.
The resolution was the only action item aside from adjournment on the agenda for this special-called meeting. The council’s regular meeting at 6 p.m. Monday is still scheduled to take place in Council Chambers on Floor 2 of Glasgow City Hall, 126 E. Main St.
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