Sinclair: Spec building could pay for itself
by Charles Warner Editor
UNION COUNTY — A planned spec building will not only make Union County more attractive to industry but could also pay for the cost of a loan the county is seeking from Santee Cooper to finance its construction.
In March, the Union County Development Board proposed that the county make itself more attractive to industry by making $3.3 million worth of improvements at three industrial sites. One the improvements proposed by the development board is the construction of a 60,000-square-foot shell or spec building, which would be expandable to 120,000 square feet. The proposal also included the construction a 60,000-square-foot building pad for possible expansion.
The spec building and the pad would be both be built in Commerce Park at a projected cost of $2 million. The board proposed funding the construction of the facilities through a Santee Cooper loan program that offers a zero-percent interest rate for the first five years.
While construction of the spec building would be a county project, the county needed the help of the City of Union to apply for the loan. As a member of the Piedmont Municipal Power Agency, the city is eligible for the loan program which is open to cities in the PMPA. In August, Union City Council voted unanimously to authorize Mayor Harold Thompson to enter into a resolution supporting Union County’s entrance into the loan program. In exchange for using its eligibility to make the loan program available to the county, the city will supply power to the facility once it is built.
In September, Union County Council took the next step in the process by voting unanimously to approve a resolution authorizing the issuance of a $2.5 million special source revenue bond. Supervisor Tommy Sinclair said that in order to apply for and obtain the loan from Santee Cooper the county is required to demonstrate that it has the means to repay the loan should it be necessary to do so. Sinclair said that unlike general obligation bonds or most other bonds the county issues the bond will not be issued against the existing county tax millage or require the levying of tax millage. Instead, Sinclair said revenue generated by the multi-county industrial park agreements the county has with Spartanburg and other counties will be allocated to pay for the bond.
“You have to guarantee you have the money to repay it if you have to,” Sinclair said. “Unlike a general obligation bond this special source revenue bond is not issued against the general tax millage. We’ll instead use revenue from our multi-county industrial park agreements with surrounding counties.”
Sinclair pointed out that more $200,000 of the annual revenue generated by the multi-county industrial park agreements is already dedicated to economic growth and development. He said this will enable the county to cover the cost of the loan if necessary without having to use tax millage.
However, Sinclair said he feels the county will not have to use that revenue to repay the loan. He said that once it is built the county will market the spec building to industry with the goal of selling it within five years. The proceeds from the sale of the building would then be used to pay off the loan.
While he could not say for certain how soon the county would be able to sell the spec building once it is completed, Sinclair said that market conditions indicate the building would not sit empty for long.
Commerce Park is located between U.S. 176 and S.C. 18 in the Bonham community, an area which has seen enormous industrial development in recent years with the construction and expansion of the Gestamp Automocion South Carolina LLC manufacturing facility and the construction of the Gonvauto North America steel service center. Sinclair has said that the main purpose of the spec building is to enable the county to take advantage of the growth that is already occurring in the area which he has described as a prime site for industrial development, particularly in the automotive industry which is a growing presence in Union County and the rest of the Upstate.
Editor Charles Warner can be reached at 864-427-1234, ext. 14, or by email at email@example.com.
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