By GAGE WILSON
for Glasgow News 1
The Glasgow Common Council approved the sale of up to $16 million in industrial revenue bonds for a construction project that will add roughly 120 senior-focused housing units along Ky. 1297.
The bonds were approved during Monday’s council meeting and will be issued to Little T, LLC, a Bardstown-based real estate company.
“It’s like an investment,” City Attorney Rich Alexander said, explaining how the bonds would work. “Say you buy $20,000 in bonds, you would be paid back that sum over 10 or 20 years plus interest.”
In regard to Little T’s bonds, the city will hold title to the land until the bonds and interest are repaid, at which point the title transfers to the company. Alexander emphasized that the bonds do not create any debt for the city and will be sold to private groups.
The lease also held a common tactic utilized by municipalities to encourage companies, a PILOT agreement. “While the bond is being retired the city will hold title to the property,” Alexander said. “So, there will not be traditional property taxes, but in lieu of property taxes payments will be made by the developer.”
“This is a little bit different from a traditional commercial bond issuance,” he added. “The developers have their financing in place. The financing will actually purchase bonds, and so, the bonds will be paid when the debt that they’ve already secured is paid… There is no liability on the city’s part on paying any of these bond obligations, it will all be the developer’s responsibility.”
Three representatives from the developer spoke to the council. The first, Mark Harris, described the units as “patio homes” designed for senior residents and pointed to similar, smaller projects the firm has completed in Russellville, Elizabethtown and Franklin.
According to Planning and Zoning Director Kevin Myatt, the project received preliminary approval two years ago. “The developers then returned in October of this year, asking for an extension of one year,” he said. “Which is not abnormal, that’s part of what we do there.”
A second representative, Kerry Pulliam, said the renewed interest stemmed from state legislation passed earlier this year. Senate Bill 25, approved in March, expanded eligibility for industrial revenue bonds to include “multifamily housing developments,” which previously had been excluded. Pulliam told the council that the bill made the financing path possible, but their approval was what determined whether the project could actually move forward.
“It’s not any secret that building costs have skyrocketed,” he said. “This would make the project go.”
Councilwoman Marna Kirkpatrick suggested tabling the item until the council’s next meeting.
“This was just laid in our lap Friday evening,” she said. “I haven’t had enough time to put my thoughts and questions into this.”
Councilman Joe Trigg seconded the motion, also requesting more time to research the project. The motion failed in a six-to-three vote.
“What’s before us is related to the issuance and sale of up to $16 million in industrial bonds,” said Councilman Terry Bunnell. “We’re not here to discuss the planning development, that’s already been done. We’re not here to talk to them about the rent, or anything but the issuance of these industrial bonds.”
“The entire responsibility of this project lies with the developers,” he added. “All they are using us for is to help finance the project.”
Pulliam returned to the floor to reiterate that the industrial revenue bonds were essential to moving forward. Without the council’s approval, he said the company would likely sell the project to a low-income housing developer.
“That would probably be our exit,” he said.
The motion was then called to question. Eight members voted in favor; only Kirkpatrick dissented.
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