“The bond fund required to pay the county’s Bond C series was short $211,000 on June 1,” Morrical said. “So we’re having a meeting to find out why that happened and why the whole board wasn’t notified what was going on. It’s something I want to get on early and resolve the issue.”
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Giorgio Karras, JLL vice president, said he is “not intimate with those finances” so he could not comment on the issue but answers will be provided at the special meeting this morning.
Commissioner Don Dixon said his office was notified of the shortfall by one of the financial institutions involved in this complicated development deal. He said there are several funding streams for the development so officials need to find out exactly what happened before they can help fix it.
“We knew that it was going to be running close because everybody knows the economy for the retail for the last three or four years has not been getting better, it’s been more challenging,” Dixon said. “I don’t know what part of the project is not bringing in the forecasted numbers, but we’ll figure it out. The big part of Liberty Center is doing fine. We have to fine-tune the financing.”
Morrical said he does not believe this means the center is in significant trouble.
“Everybody is afraid that this is a blip on the radar and something’s going bad, the whole thing is going down the toilet and everybody starts panicking,” he said. “Which we don’t want to happen. It’s been very successful. It’s the first time this has ever been done in the county and I think there is a learning curve and that learning curve is going to progress.”
The board is also considering adopting a core retail assessed valuation charge, which could help with the shortfall and “expanding the scope of services” for accounting firm Clark Schaefer Hackett.
The LCA was established to oversee the taxpayer-backed, $37 million investment in infrastructure — streets, parking, utilities and sewer and water systems — for the center. The LCA is like a homeowners association for business owners and can levy fees like the one being considered at the special meeting, to help pay the development initially and future improvements. Early on the LCA instituted a fee so Liberty Center shoppers pay 50 cents for every $100 spent.
Butler County Commissioner T.C. Rogers said until he knows what happened he can’t comment on the shortfall, but he said there is a chance the county could have to make up the difference.
“If a series of entities did not meet their obligations the county could, possibly, be ultimately responsible,” Rogers said.
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The Butler County Port Authority sold $37 million worth of bonds on behalf of Butler County Commissioners, Liberty Twp., and the Liberty Community Authority in November 2014.
Under the master development agreement, the developer is required to make minimum annual payments of approximately $2 million to pay the debt back, beginning when the center opened in 2015. It wasn’t clear Thursday afternoon how much the developer owed overall for its June 1 payment.
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