City liable if Turnage doesn’t create 10 jobs

Published 7:52 pm Tuesday, August 21, 2007

By Staff
Would withhold money from project if forced to reimburse the state
Contributing Editor
If the rehabilitated Turnage Theaters complex doesn’t result in at least 10 new full-time jobs there by June 2008, the city faces having to reimburse the state $10,000 for each job short of the 10-job quota.
During its meeting last week, the Washington City Council authorized the mayor to execute the Rural Economic Development Center grant agreement, which contains the provision that if the job-creation requirements are not met, the city is liable for reimbursing the state. The grant is for $100,000. If those 10 jobs are not created by the June 2008 deadline, the city will withhold an amount equal to its liability plus any legal fees associated with reimbursing the state, from its $450,000 pledge of economic-development funds for the Turnage complex, according to a memorandum from City Manager James C. Smith to the council and mayor.
For more than 10 years, Washington residents and others have worked with the Turnage Theaters Foundation to restore the historic Turnage complex. Many people have contributed to the $5 million project. The state has provided $1 million to the project, according to the memorandum. Federal and state tax-credit equity exceeds $1.25 million, the memorandum notes.
The funding agreement calls for the city to provide the Turnage Theaters Foundation, a nonprofit organization, $100,000 each year of that five-year period, which ends in fiscal year 2009-2010.
During his remarks to the council, John Vogt, who was executive director of the Turnage Theaters Foundation when he addressed the council last week, said it’s likely the Turnage complex, once open and operating, would result in the creation of the equivalent of up to 33 full-time jobs and probably no less than 15 full-time jobs.
Vogt, who left his position with the foundation after last week’s council meeting, said the figure of 10 full-time jobs is a “conservative” number. Vogt told council members he doesn’t expect the city to be put in a position of having to reimburse the state and withholding money from the foundation because the goal of 10 full-time jobs was not met.
Mayor Judy Meier Jennette, who spent many years working for the Beaufort County Arts Council, a nonprofit organization, said she believes the agreement is needed to protect the city in case each of those 10 jobs is not filled. Wanting to create at least 10 jobs may not result in establishing those 10 jobs, especially if it’s a nonprofit organization trying to create those jobs, she said.