ATLANTA - Brunswick County, Ga., officials have agreed to a plan for defeasing a 1991 bond issue sold to fund a beach rebuilding project that was canceled last week, the county's chief administrator said Friday.
After local opposition killed the project at St. Simons Island, the county's board of commissioners approved a motion to use up to $1.5 million in surplus tax revenues to help pay off the $2.56 million bond sale, according to County Administrator Charles Stewart.
"We are pretty confident this marks the beginning of the end of a problem that has taken up a lot of our time," Stewart said of the Oct. 1 vote in a telephone interview. "We will be glad to have this behind us.
The revenue bond issue, which was underwritten by Lex Jolley & Co. of Atlanta in October 1991, is structured with serial maturities running from 1993 to 2006 and a single $990,000 term maturity in 2011. It carries an optional call date on Aug. 1, 1996.
According to Finance Director Charles Lewis, the county hopes to wrap up details of the defeasance before the February 1992 date for the next interest payment.
The defeasance plan follows the county's decision this summer to abandon its widely criticized efforts to restore the beach at St. Simons Island.
Local opponents charged that the project, which would have used dredging to reconstruct sand dunes, was expensive and environmentally unsound.
Opposition to the project gathered steam after it was rejected by 68% of county residents participating in a straw poll held during the July 21 general primary election.
Stewart said the defeasance of the Brunswick and Glynn County Development Authority, Ga., Series 1990 A revenue bonds would be funded from three sources.
The sources are $800,000 of surplus tax revenues, $700,000 of remaining unspent proceeds from the bond issue, and $1 million of the proceeds placed in escrow for the project with Georgia. Both the state and the Army Corps of Engineers have been working with Glynn County on the project.
But the defeasance cannot be completed until the county reaches an agreement with the state on release of the money placed in escrow, the official said.
The state, Stewart noted, has indicated that it wants to withhold about $100,000 from the account to cover its expenses. The county official said he was confident, however, that the county would be able to negotiate a settlement soon.
State officials involved in the project could not be reached for comment Friday.
The county commission acted to use the sales tax surplus for the defeasance after receiving the recommendation of a specail committee set up in August, Lewis said.
He said the commission considered a number of other funding sources, including tax anticipation notes, use of a hotel and motel tax, alcoholic beverage taxes, and an increase in property taxes.