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Commission holds Hotel/Motel percentages to last year’s levels

Tim Walker
AMR Reporter

After hearing annual updates last fall from some of the organizations who receive an annual percentage of the Hotel Occupancy Tax revenue, the Pocahontas County Commission faced a tough decision about allocations of those monies at its January 21 meeting.

Before making the decision, the commission heard from two of those organizations.

Charlotte Slagle, representing the Artisans Co-op, told the commissioners that the Co-op not only promotes the arts, but they are an incubator for more than 40 small artisan businesses. She said they run galleries in four locations: The 4th Avenue Gallery in the Depot in Marlinton; Leatherbark at Cass; The Soaring Eagle at Snowshoe; as well as Pocahontas Memorial Hospital. She asked that their Hotel Occupancy Tax allotment remain at last year’s level, which was three percent (3%).

Representing the Historic Landmarks Commission, Jason Bauserman and Ruth Taylor asked that that group’s allotment be restored to the level it had been until a few years ago, which was seven percent (7%). Bauserman explained that, for reasons that he does not understand, the commission reduced the Landmark’s percentage by two percent (2%) at that time, leaving them with only five percent (5%).

Taylor explained that last year Landmarks was forced to spend $10,000 more than they received, which drained all of their reserves. She said the reason for the expenditures was emergency repairs at the Opera House and the McGlaughlin Cabin. The largest expenses involved the replacement of two broken furnaces at the Opera House which cost $5,000 each to replace. She said that it takes all four furnaces to sufficiently heat the Opera House in order to hold events there in the winter. She also said that even though two of the furnaces have just been replaced, the remaining two have exceeded their life expectancy and could fail at any time.  Bauserman and Taylor not only asked for the restoration of their tax allotment to seven percent (7%), but also asked the commission to allocate an additional $10,000 from the commission’s Bricks and Mortars fund.

The commission noted that under state law, the Convention and Visitors Bureau must be given fifty percent (50%) of the Hotel/Motel Tax revenue before any other allotments are calculated.

After much discussion and expressions of concern about the Historic Landmark Commission’s request, the commission voted to maintain tax allotments at last year’s levels, which are:

• Pocahontas Memorial Hospital: $75,000.

• Emergency Medical Services: $75,000.

• Fireman’s Association: $50,000.

• Preserving Pocahontas: Three percent (3%).

• Artisan’s Co-op: Three percent (3%).

• Arts Council: Four percent (4%).

• Historic Landmarks Commission: Five percent (5%).

• Dramas, Fairs and Festivals: Twenty percent (20%).

• Parks and Recreation: Thirty-three percent (33%).

• Libraries and Visitors Information Centers: Thirty-two percent (32%).

The Commission noted that, last year, they had given a one-time $5,000 to the Green Bank Park, so this year they will give $5,000 to the Historic Landmarks Commission to help with any needed furnace replacements at the Opera House.

Holly Chestnut, a teacher at Green Bank Elementary-Middle School asked the Commission for financial assistance to help pay expenses for six middle school students to attend Government Seminars at Charleston from February 2 – 5. She said they would interact with state government officials, attend mock trials and meet legislators. Chestnut said this is her first-year coordinating the trip for the school, and only recently realized how expensive the trip is going to be for the kids – with school bus drivers costing about $194 and registration and lodging for the students costing a total of $1,290. She has been unable to get any financial help from the Board of Education. The commission approved $500 toward the cost of the trip, which is the maximum amount they can give under their rules.

In other business, the commission

• adopted the Emergency Absentee Voting Procedures for the May 12 primary election.

• approved the hire of Bradley Nelson as a full-time Pocahontas County Sheriff’s Deputy. It was noted that Nelson had previously been a deputy, so minimal training will be needed.

Commission hears from USDA staff at special session

The Pocahontas County Commissioners held a special afternoon meeting January 21 to meet with representatives from the U.S. Department of Agriculture (USDA) to discuss a potential USDA Rural Development construction loan for Pocahontas Memorial Hospital. PMH would like to expand and add outpatient services.

Commissioner Walt Hel-mick outlined the purpose of the meeting.

“The hospital is one of the major industries in the county, as well as the health provider,” Helmick said, “so, we are looking at the expansion and construction of a partial new facility. And at this point, looking at the financing through the hospital, the County Commission and the USDA Rural Development. We’re trying to establish the need for it, and whether of not we will be looking at the West Virginia Department of Health and Human Services to determine if, in fact, the facility we have can be restructured to accomplish some of the things we want to do. Anytime you are talking about anything above a million dollars, it’s certainly very significant for Pocahontas County, being a small county. So, we’ll look at all options, and today our issue is with USDA Rural Development, and how they structure a loan of this nature and of this size.”

Representing the USDA were:

• Lisa Sharp, of the Morgantown Office, who manages business programs for the USDA Rural Development;

• Janna Lowery also from the Morgantown USDA office, who is the Director of Community Programs;

• And Jeff Owens, an Area Specialist from the USDA’s Fairmont Rural Development Office.

Sharp said that her office manages business loan guarantees for both “for profit” and “non-profit” businesses, whereby the government does not directly loan money, but offers a loan repayment guarantee to private banks who are the actual lenders. She said that, in this instance, it might be more economical for PMH to borrow or receive a loan guarantee from the USDA Community Programs, rather than from USDA Business Programs.

Lowery agreed that USDA Community Programs might be more appropriate and said that they also offer loan guarantee programs to protect a private lender for up to 90% of a loan in the event of a borrowers default on repayment of the loan, but they also offer direct government loans. The current interest rate for a direct loan is 2% for a term of up to 40 years.

She suggested that PMH use a 30-year term, because that would leave the extra 10 years to possibly re-amortize the loan in the event they cannot meet the payments in the future. She said that only the length of the loan can be renegotiated, not the interest rate. To get the loan PMH will have to submit its financial history for the last five years and show that they are unable to obtain an economical loan from a private lender since, as Lowery put it, “the government is the lender of last resort.”

PMH and the commission would also have to submit a feasibility study showing that they are able to generate enough additional income from the expansion to be able to repay the loan, and the USDA would also need to conduct an environmental study of the project and review the architectural plans submitted by PMH before the loan could be approved.

Owens added that he will figure the monthly payments based on a 30-year loan for between $4.5 and $7.5 million and will submit them to the commission.

Lowery said that the commission would need to be the actual borrower, and Hel-mick said that since the commission itself is prohibited by law from taking on long-term debt, the loan would have to be made through the appointed Building Commission on behalf of the county commission.

No final decision was made at this meeting.

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