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WINONA LAKE – Winona Lake Redevelopment Commission recommended Tuesday to the Winona Lake Town Council to forgive the remaining balance of an Economic Development Revolving Fund loan for Stonehenge Golf Course.
According to Tuesday’s resolution, on July 2, 2019, the Winona Lake Town Council adopted a resolution authorizing a loan from the town of Winona Lake Economic Development Revolving Fund to the Kosciusko Community Development Corporation in an aggregate principal amount not to exceed $2.18 million.
On Oct. 1, 2019, the town of Winona Lake and the KCDC entered into a revolving fund loan agreement and the KCDC executed its Series 2019 Note to evidence its obligation to repay the town loan. The proceeds of the town loan were used for the acquisition of Stonehenge Golf Course and related project costs.
The town loan furthered the economic development objectives of the town, the resolution states.
According to the purchase agreement, the purchase price for Stonehenge will be $644,510.29, which is the balance of the debt to Lake City Bank. Purchasing the golf course will be 28Fifty Management LLC.
Dawn Wilkinson, director of projects and operations at the Kosciusko Economic Development Corporation, said she was also representing KCDC during the Redevelopment Commission meeting Tuesday. She said the loan was done with Economic Development Income Tax (EDIT) funds through the town in order to keep economic development within the community.
Currently, Stonehenge is owned by the KCDC and leases the golf course to 28Fifty Management LLC for $1 a year and then 28Fifty Management LLC has a sublease for the club house.
“So, obviously, the golf course being a public golf course is a great asset not only to the town of Winona Lake, but also the community at large and the county as a whole. So we supported that initiative,” she said. “So tonight, we’re just presenting with your awareness that we have accepted an offer to purchase from the current tenant for the cost of the mortgage that is currently there that is held by Lake City Bank. They’re a good partner in this as well,” she said.
Commission member Dennis Daniels asked if the purchase agreement was for the golf course only. Wilkinson said yes. She said the purchase agreement 28Fifty Management LLC will maintain their current sublease within the club house through January 2030. After that, they may decide to build their own club house across the street or work out an agreement with the owners of the club house. Wilkinson said the KCDC does not own the club house.
Town attorney Adam Turner said he believes the club house and parking lot are a separate parcel and those were not part of the agreement besides the KCDC making sure 28Fifty Management stays in that sublease until January 2030.
The town committed to the fund loan. KCDC used that money to pay off the Lake City Bank loan when payments were due, said Turner.
When it comes to the forgiveness resolution, there is a remaining balance of $644,510.29 of the Lake City Bank loan. The original revolving fund note between the town of Winona Lake and the KCDC has a forgiveness clause. Indiana code says if it can be shown the revolving fund loan went to the betterment of the community, “that allows forgiveness of those things” and allows the commission to request the forgiveness of the loan.
“The deal and the agreement between the CDC and (28Fifty Management LLC) is their own deal, it’s their own arrangement,” Turner said.
Turner said Town Manager Adam Lohn presented the council with some numbers with the residential tax increment finance district and the money generated as part of the economic development of the district and it far exceeded any of the expenditures with the resolution, so the repayment for the town will come over the next 20 or 30 years through the TIF district.
The resolution was approved by the Redevelopment Commission.
It went to the Winona Lake Town Council later Tuesday and was also approved by the council.
