A decision to cut sales tax revenue allocated to the Comanche County Industrial Development Authority has left that board so uncertain of available funding, it delayed a decision on a new economic development request.
But Western District Commissioner Alvin Cargill said he wants to speak to the board in coming weeks about other potential funding sources, to include ad valorem or sales tax.
The Cache Economic Development Authority asked CCIDA members Tuesday to consider funding a strip mall project that Cache officials said would help with plans to increase Cache’s sales tax base. Authority secretary Beverly Martine said the specific request is funding to help develop a $1.2 million project on the east side of town along Cache Road, providing room for five small businesses.
Martine said the project fits into plans already under way in Cache, to include a grocery store expected to break ground in the next month, as well as potential plans for a casino and other developments not yet ready to be made public.
“This is a good time to start this,” Martine said of the strip mall project.
The proposal would be for up to $600,000 as a loan from the CCIDA, which the authority would use as matching funds for a bank loan. The authority has sources of income from other properties it owns and leases, and Martine said there already is interest from small businesses that need space but can’t find it. Moving downtown isn’t an option because there is no space available for lease. And, small businesses with limited financial resources would find it too expensive to build their own structure, Martine said.
While CCIDA members liked the idea, most indicated they are uncomfortable with committing funding to a new project — any new project — because their funding situation is limited. When voters approved a new 10-year extension of the county sales tax in March, that came with a resolution reallocating funding to the entities that benefit from the sales tax revenue. CCIDA’s allocation, which had been bringing in about $68,000, was cut by 69 percent, members said in March. And, that leaves authority members leery of committing to new projects when they still have existing projects on the table.
“Our liquidity is our biggest concern,” said authority chairman Paul Ellwanger.
Attorney Mike Mayhall said CCIDA has net assets of $1.2 million, with another $390,000 coming through monthly payments on two loans given to local businesses. While that means CCIDA potentially has $1.6 million available, it still owes Goodyear $1.125 million of the $3 million CCIDA pledged to the manufacturer for its last expansion. The authority has made five payments, and has another three payments remaining.
“We have no extra money,” Mayhall said, adding that the authority will have about nine more months of full funding coming into its account under the old allocation “before the world ends.”
Cargill said county commissioners already know they will be dedicating some new funding toward the authority and have ideas about more.
Cargill said Comanche County is to receive $23 million from the American Recovery Act, and some funding within that federal program will be dedicated to economic development. While commissioners “are still waiting for the rules” of that COVID-19 relief package, to include the percentage allocated to economic development, Cargill said they know some funds will be dedicated to CCIDA and economic development authorities in Cache and Elgin.
“That’s out there,” he said, of potential funding. “We can give money to y’all.”
But, authority member Fred Fitch said he is concerned about the uncertainty of that allocation, adding CCIDA remains “under a cloud of not knowing what our funding is.”
And, because those funds are uncertain, Fitch and others said they can’t commit to a new project.
“We have an obligation to Goodyear and we’re going to make it,” Fitch said. “I can’t vote on anything at this point in time.”
Ellwanger said because there are unanswered questions, CCIDA members preferred to take no action Tuesday on Cache’s request, rather than rejecting it outright.
“It sounds like a good project for Cache,” Ellwanger said, suggesting the CCIDA delay action.
In the meantime, Cargill said county officials want to open discussions.
“We want to look at options to get you more funding,” he said, asking to discuss the issue in another forum, with ideas to include ad valorem or sales tax (both would need voter approval, Cargill said).