FLOWERY BRANCH – The final step in the bond financing process for the Old Town redevelopment project was approved unanimously by the Flowery Branch City Council Thursday evening.
Portions of the work were declared eligible for up to $6.6-million of Tax Allocation District (TAD) financing in August of 2018 by the TAD Advisory Committee. The resolution presented to the council Thursday called for only $4.995-million of bond sales.
One big concern regarding the sale of government obligation bonds by city leaders was how well Flowery Branch would fare in a rating analysis, as that would affect bond yields and salability.
Bill Camp, underwriter for financial advisory firm Raymond James, told council members, “This is the first time the city has gone through a rating process, and you should be very, very proud…as you have secured Aa2.”
That rating is part of the Moody’s rating system. “There’s only two ratings higher,” Camp explained. “You’re the same rating as Hall County, so you should be very proud of that.”
The actual financing is under the aegis of the Gainesville and Hall County Development Authority. The term of the bond is twenty years but the city plans to “call” in the bonds for full repayment well ahead of 2040.
Camp told council the timing of the bond sale couldn’t be any better for the city. “Rates are right now as low as they have ever been during my entire career…as long as we have been keeping track, these rates…are at historic lows, so it’s a good time to borrow money.”
Upon approval of the resolution, Camp said, “Now we’re going to do what we are supposed to do: find other people’s money and wire you the funds on March 10th.”
DENIED CAPSTONE APARTMENT PROJECT BEGINS RENEWED APPEAL
Fearing an overload on already congested roads in the area, an annexation request by Capstone Acquisition, LLC, to allow for the construction of a 500-plus unit apartment complex on Spout Springs Road near its intersection with Hog Mountain Road, was denied by the Flowery Branch City Council in May.
However, with the recent opening of Exit 14 on I-985 and the widening of Spout Springs Road, the developer feels traffic congestion will be mitigated significantly at the intersection and is re-applying for sewer service from the city and would like to be annexed into the city with a scaled down construction plan for 306 apartment units.
Chris Riley, representing Capstone, told council members, “We would very much like to come into the city limits of Flowery Branch if you want us in your city limits.”
The challenge facing Capstone presently is sewer service. Flowery Branch has it already in place; Hall County does not, and county officials were hesitant to estimate when they might be able to provide service to the area until widening of Spout Springs Road is completed in two or more years.
Riley said the developer was caught in a squeeze where he could not begin construction activity until sewer service was assured.
“We’re seeking the guarantee of sewer, not the use of sewer tomorrow,” Riley said, and if that means being annexed into the city and meeting Flowery Branch’s more stringent building requirements, so be it.
As discussion continued between Riley and council members, ancillary questions arose, causing city staff, as well as Riley, to say they would need to come back to the council with answers at a future meeting.
