County moves forward on Glade Creek School funding

The Alleghany County Board of Commissioners, following meetings last Thursday (Oct. 29) and Monday (Nov. 2), agreed to move forward with a public hearing and other steps toward acquiring funding for extensive work at Glade Creek School. County Manager Don Adams presented the board with information from BB&T at last Thursday's meeting, proposing a Qualified School Construction Bond of $3,339,586 at 2.5 percent interest and closing costs of $30,000. Upon being prompted by the commissioners Thursday night, Adams returned Monday with the same loan amount at no more than 2 percent interest and a total of about $20,000 closing costs. The current average loan rate for the county would be about 4.5 percent, Adams stipulated.

The QSCB loans were originally pitched as interest-free loans, however, few banks nationwide thus far have shown an interest in issuing the loans. In addition, those which have are requesting ‘coupon' rates, or additional interest, prior to making the loans. Banks that issue QSCB loans are given tax breaks by the federal government, but rules on how those tax credits are administered have yet to be issued and how they can be sold on the open market has yet to be determined. The Internal Revenue Service was expected to issue a ruling on the matter earlier this year, but thus far, no ruling has been issued, Adams said Monday.

The QSCB funds approved by the state were well shy of the total possibly needed for the project. Not covered by the 2 percent loan would be the water and sewer needs, anticipated to cost about $800,000. The county already has an option on a piece of land near the school to be used for sewer needs and has an agreement with Glade Creek resident Cliff Phillips to place a well on his property that would feed water to the school.

The school has long standing water and sewer needs and cannot add additional classrooms without renovating both systems. In addition, the school system's estimated project cost would also require another $140,000 over and above the QSCB funds. Adams proposed another loan to fund those needs, at the current market interest rate. The county has applied for a grant from the N.C. Rural Center in the amount of $500,000.