Special meeting set for Friday to approve payout
Burlington’s city council is apparently ready to follow through on an incentives agreement that it hashed out more than a year ago with the developer of a new office park near Alamance Regional Medical Center.
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The council originally signed off on this deal with the Samet Corporation of Greensboro on June 17, 2021 in order to defray the expense of a $25 million office park that the company had proposed at the intersection of Grand Oaks Boulevard and Huffman Mill Road.
Unlike most of the council’s previous incentive agreements, this particular offer wasn’t couched in terms of cash grants that were to be paid out in annual installments after Samet had completed its office park. Instead, the council adopted a resolution in which it pledged to reimburse the company $964,000 to cover the project’s roads, water lines, and sewer mains once all of these items had been fully installed.
Now, after more than a year, Samet has made noticeable progress on this project, which it has decided to christen the Grand Oaks Professional Park. In addition to a new access road, the company has presumably completed work on the underground utility lines, and it has more or less finished the first of several office buildings that it has proposed within the 22-acre development.
In order to fulfill its commitment to Samet, the council has scheduled a special meeting for Friday in order to draw $964,000 from the city’s savings to cover the company’s infrastructure expenses. According to Burlington’s city manager Craig Honeycutt, the city is obligated to pay out these funds under the agreement that the council approved in 2021.
“There was a resolution passed that specified the terms and conditions,” Honeycutt said in an interview Wednesday, “and it stated the funds would be paid when Samet submitted the receipts and asked for the reimbursement.”
The council’s resolution also alludes to a number of other “requirements” on the company’s end that don’t appear to be actual prerequisites for the proposed reimbursement. Among other things, the resolution states that Samet “will invest no less than $25 million to develop the subject property” and “construct five office buildings,” which are “required to remain owned by for-profit entities.” It also demands that the company “pay and guarantee payment” of five years of property taxes based on an assessed tax value “of no less than $25 million.”
The resolution nevertheless allows Samet to obtain its proposed reimbursement well before it must meet these long-term obligations. In fact, the document entitles the company to receive the funds “after the city confirms that the developer has completed construction of the designated infrastructure” as well as “the first of the multiple office buildings in the project.” Even so, as a safeguard for Burlington, the resolution allows the municipality to place a lien on the property in the amount of the grant “which will not be released until the city has been prepaid its grant amount and an amount equal to five years of ad valorem taxes from the improved property.”
During Friday’s special meeting, the council is slated to approve a budget amendment on Samet’s behalf when it signs off on a so-called “consent agenda” of presumably routine or noncontroversial items. This budget amendment is the only item that appears on Friday’s consent agenda.
Once it approves Samet’s reimbursement, the council is scheduled to go into closed session to consider an unspecified economic development matter. According to Honeycutt, the subject of this closed session is a staff report that’s unrelated to the agreement with Samet.
FRIDAY UPDATE: In a brief special meeting Friday morning (Sept. 2), councilmen approved the incentives on a 3-0 vote. Mayor Jim Butler and council members Kathy Hykes and Harold Owen voted in favor. Councilmen Ronnie Wall and Bob Ward were absent.