The Maple Leaf Performing Arts Center officially has a home and a $12.5 million bank loan to build it.
The Maple Leaf Building Corporation signed an agreement with Chuck Snyder on Dec. 20 to buy his land. The sale closed Dec. 28.
A tentative agreement had been in place since July to buy 13.472 acres of the farm behind Brown County Health & Living Community for the purpose of building a 2,000-seat concert hall.
The Brown County Convention and Visitors Commission had been holding the land contract in the meantime; that board transferred the paperwork to the new building corporation Dec. 14.
The estimated cost of building the Maple Leaf Performing Arts Center is $12.5 million.
The county entered into a contract with a bank to take out a loan in that amount for all facets of the construction, including land acquisition. The closing on that contract was finalized during the last week of December as well, according to the resolution the building corporation approved.
The loan will be paid back with revenue from events at the Maple Leaf, and any shortfall will be made up with innkeeper’s tax, which is paid by local hotel, inn and cabin guests.
An entertainment tax on tickets also will help. Dist. 65 Rep. Chris May (R-Bedford) told the Times-Mail newspaper that he’s working on a bill to establish that tax, at $1 per ticket. It’s estimated to generate $80,000.
The building corporation is one of two new entities being formed to handle matters relating to the concert hall, which will be owned by county government.
The Maple Leaf Building Corporation met for the first time Dec. 20. Its role is to sign for the loan and purchase the land as an agent of the Brown County Commissioners. Its volunteer members are Robyn Rosenberg, Bill Austin and Mike Laros.
The Maple Leaf Management Corporation will be responsible for constructing, operating and managing the venue, or contracting someone else to do that.
That corporation is in the process of being formed, county commissioner Diana Biddle said last week. It will have representatives from the CVC, the Brown County Convention and Visitors Bureau, the county council, the county commissioners and an at-large member appointed by the CVC, according to a Maple Leaf fact sheet handed out at a Rotary meeting in December.
The next steps in the Maple Leaf project are for the commissioners to approve agreements with the management corporation and to schedule a groundbreaking.
The hope is to break ground in the spring, Biddle said.
Construction is estimated to take 13 months, which would make the opening date around spring 2019.
The Maple Leaf Building Corporation met Dec. 20 to get signatures for a tax identification number and to approve a 17-section resolution.
The resolution included the code of bylaws for the corporation; the issuance of two mortgage notes and their purchase agreements; the installment purchase contract; the actual mortgage for the project; the assignment of the sales contract from the Brown County Convention and Visitors Commission to the building corporation; agreements for project construction and operation; an administration agreement; and a construction fund payment requisition form.
Later that evening, the county commissioners voted unanimously to approve a resolution which included the installment purchase contract; the agency agreements for project construction and operation; the administration agreement; the designation of two promissory notes as tax-exempt; and the construction fund payment requisition form.
The installment purchase contract is an agreement between the building corporation and the county. “The plan of finance here is that the building corporation is the owner of the project and is selling the project on an installment purchase basis to the county,” explained attorney Thomas A. Pitman with Barnes & Thornburg.
The building corporation will issue two promissory notes — 2017 “A note” and 2018 “B note” — totaling $12.5 million. The “A note” for $9 million closed on Dec. 28 with the 2018 “B note” scheduled to close Jan. 17.
“That interval is designed to cut the tie between the two, to make them two separate issues for federal tax purposes,” Pitman said.
The two notes will fall into the same payment pattern so that payments don’t have to be staggered, Pitman said. Payments will be made in June and December each year, he said.
Opponents to the project had been concerned that another form of funding could be brought in to help pay the loan, such as property taxes. The bank notes include a provision “that the repayment source is limited to the net operating revenue of the project and the pledge of innkeepers tax and nothing else,” Pitman said.
The administration agreement which the building corporation approved lays out the financing process, Pitman said. According to that agreement, the Brown County auditor will be directed to set up an installment payment fund, which will be used to make loan payments.
A week before an installment payment date — in June and December — revenue from the Maple Leaf Performing Arts Center will be transferred to the auditor, the agreement says. If there is not enough money to cover the payment, the auditor must notify the CVC to transfer innkeeper’s tax revenue to her to make up any shortfall.
“That’s how the money comes together, at the auditor level for payment to the lending bank. This actually lays out the precise road map for the flow of funds, the who does what and when,” Pitman said.
The agreement also gives general authorization to any of the building corporation officers “to take actions in furtherance of this mechanism and this transaction that are sort of incidental,” Pitman said. One example of that authorization was collecting signatures for the tax ID number, he added.
“This has been a long process for you folks. It is in order to meet all of the needs of the county. It is, necessarily, fairly complex. We tried to keep it as simple as we could, but it’s hard to keep simple,” Pitman said.