October 17, 2012 EditionAlso in this issue...
Some delayed paperwork to complete an incentive offered by the Arkansas Economic Development Commission to the Birdsong Peanut Company had some county residents concerned as several attended a public hearing on Thursday afternoon regarding a bond issue for the company.
Jane Dickey of the Rose Law Firm, who is the bond attorney on the project, explained to those in attendance that the purpose of the bond issue is to offer the company a partial abatement on property taxes.
The main concern expressed by those present was why the bonds were just now being sought. Dickey explained while the paperwork was just now being completed it was something the company had anticipated happening since the beginning of negotiations with the AEDC.
Through the locally-issued bonds, the property technically becomes county-owned with a 30-year lease. However, Dickey stressed that the bonds are issued by a city or county but are repaid by the company.
"This is not a debt or liability for the county," she said. "These are special obligation bonds. Birdsong is solely responsible for payment on the bonds. It actually states on the bonds that the county shall have no financial responsibility."
She said basically the bond issue is a way for the county to show its desire to help new industries.
"The state of Arkansas does not have a lot of incentives to offer," Dickey said. "This is one incentive where the local community can offer reduced property taxes on land, buildings and equipment for a period of years."
Dickey explained that while this makes the company exempt from paying property taxes, the law that allows this type of incentive requires that the company still pay a minimum of 35 percent, which is what will be offered with this bond issue.
"Even at 35 percent, that is going to be more taxes than the county was getting off the property as farmland," Justice of the Peace Doug Wayland commented.
The proposal presented at the public hearing would allow for bonds to be issued for up to $10.5 million. County Judge Dale Freeman will have to sign off on the bond issue to make it official.
Freeman told those gathered that there is also another company, this time a peanut butter factory, showing interest in locating in the county.
He said the Houston Peanut Butter Company is in the process of acquiring land and would employ 20 to 25 people.
He said the new company's interest in locating in the county is a direct result of peanut farming and the opening of the Birdsong facility.
"It's all working together," he said. "This should also drive up the interest in peanut farming. It will cut down on transportation and shipping costs for all involved."