As “outside agencies” are begging for financial assistance from the Town of Mooresville for the upcoming fiscal year, another organization – the South Iredell Community Development Corporation (SICDC) – is in default of its financial obligation to the town.
The SICDC owes the town for accrued interest in loans of public money made to it between 1989 and 1994. But not only is the organization behind two years on its loan payment – totaling tens of thousands of dollars – to the town, it has also not paid the town, as it is supposed to do, for a percentage of two significant land transactions made in January and February. The SICDC made more than $1 million off those land sales, according to the Register of Deeds.
Mooresville Mayor Bill Thunberg – who has sat on the SICDC board both years that the organization has not paid its bill – signed "release deeds" on the two pieces of property that the SICDC sold in January and February – one to DKOTA Investments, Inc. and the other to Penske Realty, Inc. By signing those release deeds, Thunberg has essentially put the Town of Mooresville in a position where it cannot foreclose on those properties and sell them to secure the money owed by the SICDC in the event that the organization refuses to pay the town.
Thunberg did not respond to a Report e-mail asking why he signed the release deeds, but a “read receipt” indicated that he opened the e-mail at 9:10 a.m. today.
As of Wednesday, the SICDC has not paid the town any percentage of the $1 million land sales, though the loan-payback plan forged between the town and SICDC in May 2002 stipulates that the SICDC would use half of all proceeds from land sold in the Mooresville Business Park to make a payment on the debt to the town. The last land-sale payment that the town received from the SICDC was in October 2005, according to Town Finance Director Maia Setzer.
In addition to half of all its land-sale proceeds in the Mooresville Business Park, the SICDC agreed to annually pay the town 10 percent of its outstanding debt.
But for the past two years, that has not happened.
The SICDC owes the town $388,263 – the same amount it owed in 2006. The organization was supposed to make a payment of $38,826 in February 2007 and another, totaling 10 percent of the adjusted balance, earlier this year.
The town, in arrangements such as the one with the SICDC, does not typically send invoices. However, Setzer said she plans in the next few weeks to invoice the SICDC for two years of payments to the town.
This is not the first time the town has failed to collect the SICDC’s debt.
Rewind to 2002. In the heat of a state budget crunch that left Town of Mooresville officials wondering how they would fund critical services, Tribune reporter Michael Roessler exposed that the SICDC owed the town nearly $850,000 from loans of public money made to it between 1989 and 1994.
Between those years, the SICDC borrowed nearly $3 million from revenue gathered by Iredell County from the January 1986 sale of the former Lowrance Hospital, now the Government Center South on Center Avenue in Mooresville. The SICDC borrowed the money to develop Mooresville Business Park on Mazeppa Road.
The county transferred responsibility for collecting the debt to the town in 1994. The SICDC by 1999 had paid back the loan’s principal, but had not made a single payment on accrued interest between 1999 and March 2002.
Despite that, the organization – whose year-end 2001 audited financial statements indicated it had $913,468 in cash reserves while its debt to the town was $848,969 – awarded two $15,000 bonuses to economic developer Melanie O’Connell Underwood, one in 1998 and one in 1999, for attracting businesses to, and managing the business park for, the SICDC.
Underwood was the executive director of the Mooresville-South Iredell Economic Development Corporation (MSIEDC) before the MSIEDC’s board of directors asked her to resign in January. Before the MSIEDC was formed and split from the Mooresville-South Iredell Chamber of Commerce in 2006, Underwood sat on the SICDC board as executive vice president of the Chamber.
Here is a complete list of SICDC board members from 2007 and 2008, supplied to the Report by the MSIEDC:
2008
Jane Testerman
Mike Harrell, Beacon Properties
Dan Brewer, General Manager, Chas H. Sells, Inc.
Woodrow T. Washam, Jr., Iredell-Lake Norman Market President, CommunityOne Bank, N.A.
Mark Brady, Vice President, Fidelity Bank
Joel Mashburn, Iredell County Manager
Marvin Norman, Chairman, Iredell County Board of Commissioners
Sara Haire Tice, Iredell County Board of Commissioners
Abigail Jennings, President, Lake Norman Realty, Inc.
Holly Forester, Owner, Life Path Mission
Steve McGlothlin, Managing Partner, Sharon-Randall Group, LLC
Ben Thomas, Attorney, Thomas Godley Law Firm
Bill Thunberg, Mayor, Town of Mooresville
2007
Randy Marion, Randy Marion Chevrolet and SICDC President
Dr. Jane K. Testerman
Sandy Mills, Vice President/Banking Center Manager, Bank of America
Benjamin W. Sharpe, Senior Vice President, BB&T
Danny F. Beaver, Assistant Vice President, Carter Bank & Trust
Mike Cook, Cavin-Cook Funeral Home
Don Flowe, Senior Vice President, Citizens South Bank
Woodrow T. Washam, Jr., Iredell-Lake Norman Market President, CommunityOne Bank, N.A.
Jim Hadden, Employment Security Commission
Mark Brady, Vice President, Fidelity Bank
Rob G. Ellenburg, Business Relationship Officer, First Charter Bank
David Steen, Vice President, First Trust Bank
Joel Mashburn, Iredell County Manager
Sara Haire Tice, Iredell County Board of Commissioners
Dr. Terry Holliday, Superintendent, Iredell-Statesville School System
Joe Knox, Joe Knox Properties and Mayor Emeritus
Paul Smith, Chief Executive Officer, Lake Norman Regional Medical Center
Dr. Douglas Eason, President, Mitchell Community College
Dale Brawley, Executive Vice President, Mooresville Savings Bank
Edward L. Marxen, Executive Vice President, Piedmont Bank
Ben Goins, Piedmont National Financial Services
Ben Thomas, Attorney, Thomas Godley Law Firm
Jamie Justice, Mooresville Town Manager
Bill Thunberg, Mayor, Town of Mooresville
W.F. Newell, Jr., W.F. Newell & Associates
Kevin Pote, Assistant Manager, Wachovia
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17 comments:
Wow...so we forgive the SIDC for their bill. We forgive a company for their $200,000 worth of water bills.
Anyone want to guess what would happen to me if I didn't write a check to the town every month? I'd be standing in the shower looking up at the dry shower head.
6:26
So, so true, 6:26...
Wow...such a distinguished list of names to be stuck to one "tar baby!" I guess all the players will respond "no comment" as usual. I am glad to see Mooresville University's consistency in the accounting graduates, but they refuse to teach the terms "Accounts Receivable," "Default'" and "Misappropriation of Funds." Hats off again to Ms. Gatton--Cleaning up Mooresville--one agency at a time!
Food for thought: There was Ms. Underwood who worked for the SICDC, who was aware of the default in payments to the town of Mooresville and brought it to the attention of the SICDC Board. Maybe she asked them to pay the due amount owed to the city, because someone will eventually find out about the default and the SICDC will be exposed of either incompetence or flim-flam with taxpayer funds. Then some on the Board told her--don't you worry about it, you just bring in new businesses. Then Ms. Underwood continued her questions or perhaps demands to pay the outstanding bills---then wham-O--you're fired. Then Ms. Tice tells the taxpayers--we don't have to give anyone an explanation of our actions--well this is just one possible scenario--I'd like to read your. Especially the rationale behind Mayor Thunberg signing relases to property which left the taxpayers bent over without a kiss--thanks again Slick Willie!!!
Where is the $1 million dollars and is it in the SICDC or has it been given to MSIEDC to be hidden? SICDC is a public entity is it not? If the balance in 2001 was a little over $900,000 and they sold another $1 mill. last year, what is the purpose of holding all that money? I am very confused on the relationship between the SICDC and MSIEDC. The SICDC was created when the old hospital sold and that money had to be used in M/SI I believe and they created a business park. The MSI Chamber then marketed and sold the lots I believe. Now we have a whole secret corp that is being funded by new tax dollars by county and town to do what the chamber did as part of the old SICDC establishment. Has the MSIEDC done anything? what are the results to the community from this taxpayer investment? Ultimently, it still comes back to where or what has happened to the $1,900,000 in SICDC? Again very strange and very confusing. Sorry if this rambles.
Actually, I don't think you're rambling at all. You have the same questions that many of us have -- mainly because the SICDC has always operated so "secretly."
Let's see if I can clarify any of it for you, from the little bit of information I have:
The SICDC was once, from what I recall, basically the economic-development arm of the Chamber of Commerce. In January 2007, the MSIEDC was formed as a non-profit -- or public-private -- entity. The MSIEDC was formed in response to recommendations in the Angelou Economics study, which was funded by Iredell County, the Town of Mooresville, the Chamber and the SICDC.
Since one goal of the MSIEDC was to depend more on private-sector funding than on public funds, the organization kicked off a five-year, $1.8 million fundraising campaign in late 2006 to help it carry out many of the recommendations listed in the Angelou study.
Still, as was pointed out in the blog article earlier this week, the MSIEDC still heavily relies on public funding.
Now, as for the SICDC, your guess is really as good as mine about its exact purpose. But from what I have always understood (and would appreciate any clarification/correction if anyone knows otherwise), the SICDC continued (even once the MSIEDC was formed) solely to continue handling land transactions for economic development purposes.
I'm sure it's more detailed and confusing than that, but that's the short answer (from the information I have).
Now to your questions about the money (and much of this is information that is already posted in the blog entry): The $850,000 that the SICDC owed the town in 2002 was from accrued interest from loans of public money made to it between 1989 and 1994.
Between those years, the SICDC had borrowed nearly $3 million from revenue gathered by Iredell County from the January 1986 sale of the former Lowrance Hospital. The SICDC borrowed the money to develop Mooresville Business Park on Mazeppa Road.
In 1994, the county transferred to the town the responsibility for collecting that debt. The SICDC by 1999 had paid back the loan’s principal, but had not made a single payment on accrued interest between 1999 and March 2002.
In 2001, the SICDC apparently had $913,468 in cash reserves, while its debt to the town was $848,969. It's unclear why it didn't simply pay off the town with its cash reserves.
Why the SICDC has not made a payment to the town in the last two years -- and why it hasn't paid off its remaining $388,263 debt when it just made a combined $1 million in land sales in the Business Park two months ago -- is really anyone's guess.
That probably didn't even come close to answering your question. I don't know the exact relationship between the MSIEDC and the SICDC. And, unfortunately, I just deleted an e-mail from one of our town commissioners in which he explained the MSIEDC's substantial impact on last year's local economy (I think it was in the high hundreds of millions, but don't quote me on that). The e-mail did not detail exactly how the MSIEDC was responsible for such a substantial impact, though.
Whew. Now *that* is what we call rambling! ;o)
I hope it helped at least a little.
P.S. I guess I should have also pointed out, just for further clarification, that the SICDC has made annual payments (and some land-transaction payments, such as the one in October 2005) on the $850,000 debt to the town since 2002. The $388,263 is what's left of that $850,000 debt.
-I hope the town receives a $388,000.oo check this week because this could get ugly. I 'm sure the "oversight" apology will be with it, but here is another question regarding Mooresville financial matters--no wonder other towns in the area think we're stupid.(Besides buying a cable system--)
I'm a little confused. Do I understand that Bill Thunberg unanimously signed away the collateral we had with this SICDC organization? If so, where has he been given the official right to do that? And even if he was given the right, why would he do that? I'm totally confused. You would think there would be checks and balances to prevent giving one elected official this much leeway. Otherwise, wayward mayors coudl be writing off stuff right and left.
Looks like we got us another runaway mayor folks
If I'm doing my math correctly, we should have been paid the entire debt in full after the million dollar land deals recently. That's almost $400,000 that should be in the town coffers right now instead of in the SICDC bank account, because of the agreement made between the town and the SICDC in 2002. If I am indeed correct, then mayor Thunberg has single handedly usurped the will of the previous board by signing away our collateral, and by so doing has violated his fiduciary duties to the taxpayers of this town. Likewise, if the commissioners do not hold his feet and the SICDC feet to the fire immediately, then they will become complicit in this situation by abdicating their own duties as elected officials.
What do you mean "The town, in arrangements such as the one with the SICDC, does not typically send invoices"???? What I want to know is just who winked and nodded at Maia Setzer to let her know it's OK for her to not send an invoice for the $70,000 the SICDC owes us. I can take a good guess who!
I swear. If I see Thunberg and Tice's names on another so-called board list, I'm going to puke. Can we say "control freaks"? What are their fingers not into?
It is a strange coincidence that Thunberg and Tice appear on so many boards together. However, that would be fine if the public could ever get a forthright explanation of what the 'public representatives' are doing with the public's money and the public's property. It is the condescending attitude that gets me. "We don't have to explain what we're doing". Somewhere along the line, someone needs to explain to these people that when they are elected to serve the public, they have obligations. First and foremost is to listen to your constituents and represent their desires on how governement should serve the public. Unfortunately, it seems we have a group of autocrats that believe being elected to a public office exndows them with a divine knowledge of what is best for the people and act on their own desires and wishes and disregard the publics wishes. That's exactly how we wound up owning a cable system. How many people did you talk to in the community, other than Pope Thunberg and his Cardinals, believe getting in the cable business was a good idea? How many times did your elected representative ask you whether or not you wanted your tax dollars invested in this venture?
It is a strange coincidence that Thunberg and Tice appear on so many boards together. However, that would be fine if the public could ever get a forthright explanation of what the 'public representatives' are doing with the public's money and the public's property. It is the condescending attitude that gets me. "We don't have to explain what we're doing". Somewhere along the line, someone needs to explain to these people that when they are elected to serve the public, they have obligations. First and foremost is to listen to your constituents and represent their desires on how governement should serve the public. Unfortunately, it seems we have a group of autocrats that believe being elected to a public office exndows them with a divine knowledge of what is best for the people and act on their own desires and wishes and disregard the publics wishes. That's exactly how we wound up owning a cable system. How many people did you talk to in the community, other than Pope Thunberg and his Cardinals, believe getting in the cable business was a good idea? How many times did your elected representative ask you whether or not you wanted your tax dollars invested in this venture?
to the April 21 5:25 post:
HALLELUJAH!!!! I can't speak to Mrs. Tice's part in any of this, since I haven't had much dealings with her, but every time I see Thunberg I wonder how he can see with his selfrighteous nose so high up in the air. Who is he anyway? Where did he come from? What has he ever really done beside squeeze himself into a bunch of nonsense boards where he can see and hear everything that the rest of us lowly people don't have "any business knowing"? He couldn't manage to keep his seat on the school board so he bought his way into the town board with developer money and money from the lawfirm his wife works for.
“Pope Thunberg” had his sights on being the next Joe Knox of this town and having streets and parks named after him! He wanted the cable deal so bad because he thought he could then control the media and use it to make his weird dream (our nightmare) a reality. Dream on!
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