Wednesday, March 2, 2022 - 00:00

Local Government Commission Approves Major Refinancing for Monroe Expressway Affordable Housing, Municipal Projects Totaling Over $1 Billion Get Green Light

Affordable Housing, Municipal Projects Totaling Over $1 Billion Get Green Light
Raleigh, NC
Mar 2, 2022

(Raleigh, N.C.) – The North Carolina Turnpike Authority will save more than $8.7 million after the Local Government Commission signed off on its request to refund bonds issued to construct the Monroe Expressway, one of the busiest roads in North Carolina.

The 18-mile toll road runs from near I-485 in Mecklenburg County to U.S. 74 between Wingate and Marshville in Union County, which is a commercial corridor. It has eight interchanges. The Monroe Expressway was the first toll road in the Charlotte area, designed as a high-speed regional alternative to relieve congestion and stop-and-go traffic at about 24 stop lights on U.S. 74 in Union County.

“Any time we can lower the cost of borrowing money means we bring more certainty and stability to the project and even possibly lower tolls at some point,” said State Treasurer Dale R. Folwell, CPA. He said helping government bodies get the best and least-expensive financing possible is a key function of the LGC, which he chairs.

Tolls were increased at the start of this year. For NC Quick Pass customers with a transponder traveling the full length of the Monroe Expressway, the cost is now $2.72. The bill-by-mail rate is $4.20.

According to past N.C. Department of Transportation projections, revenue is expected to reach $38 million in 2030, $50 million in 2040 and $81 million in 2058. The tolls are used to pay back more than $600 million in bonds and a $166 million federal Transportation Infrastructure Finance and Innovation Act loan. Once the expressway is paid off, there won't be a fee to drive it.

The Turnpike Authority is a nine-member body including N.C. Department of Transportation Secretary Eric Boyette. Four authority members are selected by the governor, two by the House of Representatives and two by the Senate.

The LGC, which is staffed by the Department of State Treasurer, has a statutory duty to monitor the financial well-being of more than 1,100 local government units. The commission also examines whether the amount of money local units and state agencies borrow is adequate and reasonable for proposed projects and confirms the governmental units can reasonably afford to repay the debt.

In other action on the agenda, the LGC approved a request by the North Carolina Housing Finance Agency for $850 million in home ownership revenue bonds to assist low- and moderate-income households to secure home ownership.

The Housing Finance Agency plans to use proceeds from the bonds to purchase pooled mortgage loans and other obligations, and to refund previously issued bonds. The purpose is to increase the state’s supply of affordable housing for the next 12 to 24 months.

After lengthy discussion and a series of questions, the LGC gave the green light to the town of Holden Beach for a $3.3 million installment contract to purchase fishing pier property and an adjacent lot. An installment contract allows payments to be made over time on a set schedule.

The project has stirred controversy among the 600 residents of the island community. The town says the purchase is necessary to provide regional public beach access, public parking and access for beach nourishment and public safety.

LGC members were concerned that the underwater portion of the pier had not been inspected, and sought clarity on the involvement of Holden Beach Mayor Alan Holden, whose real estate firm handled the sale of the property.

Town Manager David Hewett said a $16,000 underwater assessment will be conducted soon. Bad weather made it impossible to do the inspection previously. For his part, the mayor said his real estate company listed the property before the town expressed an interest in it. When the town pursued the purchase he gave up a six-figure commission and withdrew from any negotiations. A copy of the mayor’s affidavit stating as much was provided to the LGC. On Tuesday the mayor said said nobody affiliated with his company would benefit from the sale. The town’s attorney sent a letter to the LGC staff stating he reviewed the transaction for conflicts of interest and ethical breaches and found none.

Although the contract was approved, Treasurer Folwell urged town officials to limit a town-wide paid parking plan to the beach property to be purchased as a trial run. The parking fees could be expanded elsewhere later if desired. He also recommended the town continue to explore lower-cost financing alternatives to the taxable loan, which typically carries higher interest costs.

Guilford County was granted approval for $41 million in general obligation bonds to meet a host of essential needs. No tax increase is anticipated. The money will be used to replace, modernize and repair HVAC systems and elevators, and for waterproofing and roofing in various public buildings. Adding sewer infrastructure, and dam improvements would be done at Bryan Park North.

LGC members voted to approve nearly $20.6 million in general obligation bonds for Union County to meet the needs of a growing population and increased service demands. No tax hike is expected. The money will pay for design costs for a new elementary and new high school, renovations and improvements at South Piedmont Community College and the main library, and park amenities. Renovations to law enforcement facilities including the historic courthouse, government/judicial center, Progress Building, radio shop and jail cell blocks are included.

Lake Lure (Rutherford County) received approval of a $12 million revolving loan for sewer lines and other infrastructure for Phase 1 of a plan to replace the existing 95-year-old system and avoid the risk of catastrophic failure from the system that is noncompliant with state Department of Environmental Quality standards. Once all phases are completed the new system financed in Phase 1 will carry flow from the town and its customers including Chimney Rock Village and Rumbling Bald Resort.

LGC members approved several other installment contracts, and a revolving loan increase:

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