Questions from Rhine city council members arose at a special called meeting this past Thursday, October 21, 2011, over a resolution approving a bridge loan in the amount of $200,000.00 to pay expenses for calendar year 2010 regarding a new water/sewage facility prior to receipt of a guaranteed USDA loan.
The purpose of the special called meeting was to discuss interim financing for the water/sewer project. Mayor Carter Clements presented a one-item agenda entitled ratification of bridge loan resolution. Attendees of the meeting included Mayor Clements, city council members Wayne Hilliard, Kay Spires, Roy Williams and Dena Barrows, secretary Casey Lann, police chief Kip Cravey, Wilcox State Bank representative Shannon Vickers, Rhine City Attorney Joey Marchant and Rhine citizens Harris Burnham and Donna Jean Hulett.
Discussions were held concerning a resolution authorizing the issuance of a bridge loan in the amount of $200,000.00 from Wilcox County State Bank. The resolution was dated June 16, 2010 and signed by mayor Clements. June R. Sheffield attested the documents as secretary for the City of Rhine. The resolution specified a loan would be issued by Wilcox County State Bank with an interest rate of no more than 5%, calculated on an actual 360 day basis, payable 12 months after closing.
Council members Hilliard and Barrows questioned the resolution and the issuance of the loan. Barrows stated that city council did not vote on nor approve the resolution. Barrows stated that she has served on the city council for the past four years and had no knowledge of the loan.
There were no minutes or records available to the group from prior city council meetings to validate any questions or inquiries regarding the loan. City attorney Marchant advised the council to maintain records and minutes of all meetings.
Mayor Clements informed council that the loan was no secret and that invoices were being paid. Councilwoman Spires informed the council members she had knowledge from phone calls she received to approve the paying of the invoices over the phone.
Additional discussions were held regarding the purchase of property. Barrows indicated she had no knowledge of the city purchasing any property until she was notified of a closing for the piece of property purchased. Barrows stated that was when she was aware of a loan. Hilliard agreed with Barrows and stated he could only recall approving a purchase of 33.9 acres of property from Robert Lowe and Roger Laster.
Vickers informed the group that the bank made the loan for $200,000.00 in good faith for the City of Rhine. Vickers informed the group that the June 16, 2010 resolution must be ratified in all respects regarding the loan.
Questions arose to city attorney Marchant concerning the disbursements from the loan. Marchant provided an exhibit to include all disbursements regarding the loan in question. Disbursements included professional fees in the amount of $110,650.00 to Rindt McDuff and Associates, Inc.; land purchase for 18.61 acres in the amount of $43,631.02 to Duane Conley ($2,344.49 per acre), land purchase for 33.9 acres in the amount of $41,272.81 to Robert Lowe and Roger Laster ($1,217.49 per acre); survey fees in the amount of $3,221.75 to Mike Moore; and attorney fees in the amount of $ 1,060.00 to Joseph I. Marchant. Disbursements totaled $199,835.58. The disbursements began on January 7, 2011 and concluded on August 25, 2011.
A resolution of the city council of the city of Rhine ratifying resolutions previously adopted approving a bridge loan with Wilcox County State Bank was presented for approval. A motion to accept the resolution was made by council member Williams and seconded by Spires. Mayor Clements called for a vote and council members Williams and Spires voted in favor and Hilliard and Barrows voted against. Mayor Clements voted as a result of the tie and the resolution was adopted and approved by a vote of 3-2.
