“That money can’t just sit there,” Fehr said. “It could be a donation, revolving loan, infrastructure, support the land bank. But my goal to Mike is we just can’t have that money sitting there, we’ve got to make it useful and get it out into the community.”
Port authorities are funded by fees for services, so they are dependent on a steady flow of transactions for funds. McNamara told the Journal-News officials expect to close on the mega Spooky Nook sports and convention complex under construction in Hamilton soon, he expects an estimated $770,000 fee from that development.
RELATED: An extra $1M could soon be available to help Butler County projects
Since McNamara took over in 2015, the port has closed 12 projects worth a total of $260.5 million and received almost $1.4 million in fees. Over the first 13 years, from 2005-2014, the port authority provided services for 16 projects with a total value of $214.35 million.
Ongoing annual fees for all port deals will be $196,776 this year. Those fees are for leases and bond maintenance, so they do fluctuate. For example, the annual fees for Liberty Center were $68,400 this year but gradually drop to $42,434 in 2025.
Under Ohio law, port authorities can own, finance, construct and lease real estate including land, buildings and equipment. A port authority that buys or owns property for an expanding business, construction materials and other construction costs are tax-exempt. Also, ports can issue taxable and tax-exempt bonds, offering borrowers longer-term, fixed-rate financing than the terms of a commercial loan.
McNamara said they could provide grants or loans to local jurisdictions, possibly matching funds, “nothing is off the table.”
“There are a lot of options and a lot of opportunities we seek to help Butler County, but our end goal is to elevate the economic development environment in Butler County,” McNamara said. “So we want to look at all the options that we have that can do that.”
The port is governed by its own autonomous board and that body is on a fact-finding mission now, according to chairwoman Denise Quinn. She said the sub-committee is on “step one” of trying to gauge where the extra money might be most beneficial to the county as a whole as well as defining options that should not be endorsed.
“The good news is that we find ourselves in a position that we can reinvest in the community…,” Quinn said. “We asked for the feedback from the economic development directors and managers from the various cities and entities to give us feedback on if they had their druthers what might that look like, how would we support them.”
The port was adrift several years ago and rather than having extra cash, had to borrow from the commissioners to stay afloat. Some officials said the port “blew up” in April 2014 when former executive director Mike Campbell was placed on unpaid administrative leave and a board member abruptly resigned.
Financial documents showed the port would have been almost $30,000 in the red by the end of May that year. Campbell’s $85,849 salary, $6,720 annual car and cell phone allowance and other expenses made up the bulk of the bills.
The commissioners approved $40,000 to keep the port afloat on top of a previous $15,000 loan. By mutual agreement between the commissioners and the port board, Fehr briefly took over as executive director after Campbell left.
Traditionally the largest expense for the port has been the executive director’s salary. McNamara holds a dual role as an administrator in Fehr’s department so his $85,000 salary is split between the county general fund and the port authority.
The port’s fact-finding mission fits in nicely with the commissioners’ own economic development focus that will kick into high gear at year’s end, when general fund debt is erased. There will be about $10 million to invest, some of the money is earmarked for capital improvements but the county also wants to spur job growth.
“I think it will give us a broader range of projects to look at and give us more information to deal with to make the decisions we’re going to be making and kind of rate the projects,” Commissioner Don Dixon said. “I think it’s a good thing and should fit hand in glove with our 2020 Plan. At the end of the day we’re trying to do the same with all of them and that’s create jobs and keep the county healthy.”
Hamilton will be the first recipient in 2021 with the commissioners’ $2.5 million contribution for infrastructure at Hamilton’s Spooky Nook Sports Champion Mill project.
When times were turbulent for the port the commissioners contracted with Warren County Port Authority Executive Director Martin Russell to help with deals. Russell, who is now also that county’s assistant county administrator, said it is not unusual for port authority’s to use excess fee funds to further economic development growth. Several years ago his port created a bond fund with an excess $1 million. He likened that mechanism to a parent co-signing a car loan for a child.
“The bond fund itself has no direct (cash) infusion into deals,” he said. “We are a credit enhancer. What you find either with some projects that are out there — and they can be both business and or community-based — there’s just something that’s not getting them over the hurdle. The hurdle could be the project is good, it just needs a little credit enhancement.”
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