Rocky Mount community center would add debt without taxpayer OK

Rocky Mount city officials on Dec. 12 moved ahead with plans to build a community center that could cost taxpayers more than $50 million despite the area’s slumping population and declining property values.

The Rocky Mount Downtown Community Facility was introduced in 2012 as a plan to boost the local economy by providing a youth sports center and corporate events facility. But while city leaders tout the necessity of the project, some community members are concerned that the new debt will cause a spike in property taxes and make the area even less attractive to businesses and residents.

Rocky Mount’s metro area population of 56,000 has seen a decline of 3.3 percent since 2010, according to the U.S. Census Bureau. Nash and Edgecombe counties, which both are included in the Rocky Mount area, also have seen declining populations of 2 percent and 4.2 percent, respectively, between 2010-15.

The city’s property revaluations also are due for release in January, and could result in as much as a 15 percent drop in property values, causing even more concerns. Rocky Mount residents could face a property tax hike of more than 17.5 percent, Rep. Jeff Collins, R-Nash, told members of North Carolina’s Local Government Commission during a Dec. 9 hearing.

During that meeting, LGC members heard arguments both for and against the project, ultimately deciding to grant Rocky Mount permission to issue special obligation bonds of $33.7 million to fund the plan. The bonds do not require voter approval, and are repayable over 20 years. The loan will accrue $17 million in interest, bringing the total cost to $51 million.

Since taxpayers will repay that money, it’s problematic that city residents were not allowed to vote on the project plans, Collins said.

“If it’s a city, a county, or whatever that’s going to go into a significant amount of debt, the people need to have a say over whether or not the project is worthwhile,” Collins told the commission. “In this case, Rocky Mount is clearly going to be paying for the project at least partially from property taxes, but citizens aren’t getting any say in whether or not they think it’s worth them paying to get this project.”

Residents had multiple opportunities to offer feedback during the city council’s public comment sessions, Rocky Mount Mayor David Combs told the LGC. Public support has outweighed opposition, he said.

“We’ve had numerous public hearings — both large and small — to inform the public about this project. At the last one we had there were 35 people there, and only five people spoke against this project,” he said.

But public hearings are no substitute for a voter referendum when it comes to pushing taxpayers into a large debt, said Lige Daughtridge, a Rocky Mount business owner and the president of the Rocky Mount Community Council.

Daughtridge, who formerly was chairman of the Rocky Mount Chamber of Commerce, has led opposition against the project since plans were released four years ago.

“Certainly I’m concerned about the impact it’s going to have on Rocky Mount,” Daughtridge told Carolina Journal. “Is it going to allow us to be able to pay for things we need to pay for, such as infrastructure? And how can we spend money on things like this when we have so many people that are unemployed, and when the property tax values are going down?”

“This whole thing does not make sense,” he continued. “If we’re trying to boost our economy, and yet we’re putting all of our eggs in one basket, that’s just not going to work.”

The community center plans span 175,000 square feet with 73,000 square feet designated for eight basketball courts and 16 volleyball courts, along with seating for 5,000 people.

The facility would offer more than just a youth sports center, however. According to the city’s FAQ information sheet, “The facility would also welcome other youth and amateur tournaments, dance competitions, concerts, family shows, convention and trade shows, consumer shows, meetings and conferences, graduations, church related events, social events (reunions), and many other types of events.”

A community health center has been added to the project. That plan has raised questions about conflicts of interest, given that city council member Reuben Blackwell is the president and CEO of Opportunities Industrialization Center, the organization that would move its health clinic into the facility.

State Auditor Beth Wood questioned Rocky Mount City Manager Charles Penny about the issue during the Dec. 9 LGC meeting, pressing him about ethics.

“I understand the legalities as far as getting down to the legal and nonlegal,” she said. “I’m asking the question, ‘Why is this clinic moving into this facility?’ I know y’all wouldn’t do anything illegal, but in my opinion, perceived or actual ethics violations matter.”

He responded that the clinic was included only to attract federal New Market Tax Credits that would add roughly $7 million to the project budget.

The NMTC program requires that the health center be federally qualified, he added, noting that OIC is the only eligible clinic within the city’s limits.

“If New Market Tax Credits were not acquired, the clinic would be a moot issue — it wouldn’t be in the building at all,” Penny said.

To Daughtridge, the scattered scope of the project is just more evidence that the facility may see very little success.

“It’s not a good idea to put so many things — including the health clinic — into this event center to try to make it work,” he said. “This is mission drift, and I’m not convinced we’re going to be able to attract people to this center in the way the city council expects.”