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Erwin BMA discusses variety of topics

By Brad Hicks

From tax collections and grant opportunities to walking trails and economic development incentives, a myriad of projects and initiatives was discussed during a Erwin Board of Mayor and Aldermen work session held Monday, March 13, at Erwin Town Hall.

Erwin Mayor Doris Hensley said that projected revenues currently look good overall.

Hensley said that as of Feb. 28, the town has collected just shy of 55 percent of the total revenues officials had projected for the 2016-17 fiscal year. She said the reason this number is not greater is that payments in lieu of taxes, or PILOT, have not yet been taken into account.

Those providing PILOT to the town have until June 30 to do so. The most significant provider of PILOT to Erwin is Erwin Utilities, from which Town Recorder Glenn Rosenoff said the town is set to receive around $590,000. Hensley said with PILOT taken into account, the town is ahead of its projected revenues.

As of Feb. 28, the town has collected 90.9 percent of the amount projected for the current fiscal year, Hensley said. However, she added more payments have been made since the last day of February and the collection of delinquent property taxes is more than 170 percent above the projected amount.

Recent developments may aid the town in meeting the mark set for the wholesale liquor tax, Rosenoff said. The Food Lion on North Main Avenue has begun selling wine, and a package store also located on North Main Avenue may open its doors next month. During its regular Monday meeting, the Erwin Board of Mayor and Aldermen approved wine sales permits for the Roadrunner convenience store located on Jonesborough Road and the Scotchman convenience store located on North Main Avenue.

Business taxes are falling below the mark, but Hensley said the town collects the biggest portion of those at the end of this month. Still, she said the recent closure of Erwin Motors may lead to a reduction in business tax collections.


Possible upcoming expenditures discussed during Monday’s work session include new police cars for the Erwin Police Department and a fire truck for the Erwin Fire Department. Hensley said the town has utilized only 47.1 percent of its projected expenditures for the current fiscal year, so the town is “on schedule” in that area.

Hensley said officials have decided not to pursue the proposed Downtown Connector Trail project due to right-of-way issues along South Main Avenue. She also discussed the difficulties the town has experienced in attempting to complete its proposed Linear Trail extension project, an undertaking that has been in the works for around six years.

This trail project calls for the construction of a tunnel under a portion of the railroad that would allow the trail to be extended to Fishery Park. When the project plan was originally approved by the state, an 8 percent grade was required. Erwin officials have said the state has recently stated a 5 percent grade is now required.

Rosenoff said the grade change would cause the cost of the project to go from around $458,000 to approximately $777,000.

“That’s too much, in my opinion, for us to have to do unless we can get more money,” Hensley said.

Rosenoff said he is checking with the Tennessee Department of Transportation to see if the grant funding previously awarded for the Downtown Connector Trail can be used toward the Linear Trail extension. This funding, with some additional monies, would allow the town to complete the tunnel and trail extension to the park, Hensley said.

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Economic development incentives that the town could offer were also a topic of discussion. Hensley said Town Attorney Thomas Seeley III is working with Nashville-based attorney Tom Trent to see if the town could use tax-increment financing should an industry set up shop in Erwin.

Tax-increment financing, or TIF, is a tool in which governments or economic development agencies can issues bonds to pay for redevelopment projects that contain public value. Essentially, a TIF allows governments to fund community developments with future tax revenues.

Rosenoff said the Downtown Erwin Redevelopment Loan Program is set to launch on May 1 and has already garnered some interest. The DERLP is a fund to assist small business owners and property owners with purchasing or renovating downtown property or to purchase equipment for the direct purpose of business creation, expansion or retention.

The DERLP would be created through lending institutions each contributing $25,000. Rosenoff said three local banks – Bank of Tennessee, Mountain Commerce Bank and First Tennessee Bank – have each committed to an initial plan to each contribute the $25,000 for the first and second years of the DERLP.

The DERLP would be administered by the Northeast Tennessee Economic Development Corporation, which is part of the FTDD. Participating lending institutions would make a zero percent, 10-year loan to the NETEDC to fund the loan program. The NETEDC would manage the loan fund and produce income from the fund interest, loan interest and fee income of the program.

The contributions from the banks participating in the DERLP would essentially create a $75,000 pool of money per year. Those wishing to renovate or purchase equipment for their existing downtown businesses or those wishing to purchase property in the district could then apply to NETEDC to seek a loan of up to $25,000. The loans are open to for-profit and nonprofit businesses, governmental agencies, partnerships and individuals. The funding may be used to improve commercial or mixed residential property located within the Downtown Redevelopment area as defined by the loan program, meaning the money could be used to purchase equipment, a property in its entirety or a portion of it, exterior improvements, and interior renovations.

The loans offered through the DERLP would have an interest rate of around 4 percent, Rosenoff said previously. He also said participation in the loan program would not interfere with the ability for an existing or prospective property owner to seek additional funding through conventional commercial loans but would offer a better rate than is typically seen in such loans.

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There has been some interest in the town-owned Morgan Insulation property. A developer previously approached the town to propose housing mixed-use businesses at the site.

This proposal was also discussed during the Feb. 13 meeting of the Erwin Board of Mayor and Aldermen. At that time, Rosenoff said that according to the developer’s idea, the site would serve as a location for mixed-use businesses, with cargo containers near the front to the property possibly housing commercial businesses. Existing facilities near the rear of the property could be repurposed to house manufacturing.

Hensley said Monday the town had not yet received additional information it was seeking from the developer on the proposed undertaking.

Hensley also said LPG Ventures has asked the town to rethink its stance on its proposed venture, something the town would be willing to do if it receives the information requested from developers.

This project was discussed by the Erwin Planning Commission during its Jan. 25 meeting. John Baanders, president of LPG Ventures, and investment partner David Eastin were seeking the commission’s approval of a concept site plan for the property facility.

Baanders told the planning commission the project would involve the construction of a propane distribution facility on approximately 5.8 acres of property along North Industrial Drive owned by CSX Transportation. Through the project, two aboveground 30,000-gallon propane storage tanks would have been installed on the site, and the ability to unload railcars and load distribution trucks onsite would have been implemented. Baanders said railcars would be used to transport propane gas to the storage tanks. The gas would then be transferred to the tanks for holding. From the tanks, the gas would be transferred to distribution trucks, which would transport the propane to retailers throughout the area.

Baanders said the terminal would be operated by a local partner, who wished to remain anonymous until the project moved forward, and employee three full-time workers, with additional seasonal workers staffed during the peak months of winter. He said the venture would represent a $2 million investment on the site, and full property taxes would be paid once the terminal is established, as the partners would not seek any type of tax incentive to construct in Erwin. Eastin said the partners involved in the project intended to purchase the property from CSX.

The facility would follow guidelines outlined by the National Fire Protection Association, and the facility would be equipped with shutdown systems and other state-of-the-art emergency equipment, Baanders told the planning commission in January. Baanders and Eastin further stated no gas would be vented into the atmosphere as a result of the facility’s operations as no vapors would be present during the connection and disconnection of transfer hoses.

Baanders said storage tanks of the size proposed for the site would required more than 1,100 gallon of water per minute to cool in the event of a catastrophic event. He added the facility would rely on the Erwin Fire Department to provide protection.

But local officials expressed concerns. Erwin Fire Department Chief Darren Bailey said he would like to see the development partners install water monitors and a fire pump to bolster protection, adding the EFD lacks the infrastructure necessary to cool the tanks should an event occur.

The Erwin Planning Commission tabled its consideration of the site plan in January. Since then, town officials sent correspondence to the developers seeking more information on fire protection, but Rosenoff said the developers did not address the safety concerns town officials share.

Still, Rosenoff said CSX would like to see the venture established, as it would bring 600 to 1,000 railcars per year into the local rail yard.

• • •

A developer is continuing work to renovate the former Elm Street School on Elm Avenue into a residential development, and Hensley said others have expressed interest in constructing housing in other areas around Erwin, including the green space across from Erwin Utilities.

Rosenoff said the town did not receive a facades grant it was pursuing for the current fiscal year, but will review the application later this year to resubmit for the grant in the future.

The town must also locate additional qualifiers for the HOME Grant it received last year.

The HOME Program is funded by the U.S. Department of Housing and Urban Development and administered in part in Tennessee by the Tennessee Housing Development Agency.

THDA officials were in Erwin on July 12 to present a total of $750,000 to the mayors of Erwin and Unicoi County. The THDA awarded a $250,000 in HOME Program grant funding to the town of Erwin.

The funding is to be used to renovate single-family homes in the within the town limits, and the program benefits low-income families and individuals who could not have otherwise afforded to complete residential rehabilitation projects.

Each home selected under the program will receive up to $40,000 for rehabilitation to bring it up to code. Financial assistance for home repairs is provided to those selected for the program in the form of a deferred grant that is forgivable at 20 percent per year if the homeowner remains in compliance.

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Hensley said it may be June or July before the town receives word on Community Development Block Grant funding it is pursuing to establish a municipally-operated ambulance services providers.

During its Feb. 13 meeting, the Erwin Board of Mayor and Aldermen approved a resolution authorizing Hensley to request up to $300,000 in CDBG funds for the 2017 fiscal year for the purpose of establishing an ambulance service.

Although Hensley said MedicOne, the county’s current ambulances services provider, has made recent strides, including the bringing in of additional personnel, the acquisition of a new base for its local operations, and the renewal of its bond with the county for an additional two years, she said the town continues to receive complaints regarding the company, primarily from local nursing homes awaiting patient transports following hospital discharges.