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Barn coming along; financing still in works

Months of delays are over as the steel frame of a new livestock barn dominates the Lawrence County Fairgrounds. Now, the question facing the fair board is how to pay the mounting construction bills after its most recent plan to finance the project has hit legal hurdles.

On Thursday the fair board learned that it could not move forward with its plan to issue $700,000 in bonds it wanted the county to purchase. The group is now seeking private financing options.

Recently County Treasurer Stephen Burcham started an investment program where he purchases bonds issued by county governmental agencies to give them a break on interest rate while boosting the amount the county earns on its investments.

The fair board had wanted to participate in that program to raise money to pay back an earlier loan from the county and have money to pay the contractor putting up the barn.

“I heard from bond counsel that they did not qualify under the provision of the Ohio Revised Code,” Burcham said on Friday. “That was their opinion.”

In contention was whether the fair board could be defined as a governmental body.

“I had a discussion with bond counsel (contending) that they were a statutory entity created by the Ohio Constitution and were audited by the state auditors,” Burcham said.

Peck, Shaffer, Williams of Cincinnati, bond counsel reviewing the proposal, said that argument had merit, Burcham said.

However, it wanted a legal opinion before it would sign off on the bond issuance.

“They didn’t see it to be a clear-cut answer,” Burcham said. “They thought a possible addition from the attorney general might be in order. But that takes a little while to get that.”

Earlier this year the county, acting as the fair board’s fiscal agent, borrowed $400,000 from PNC Bank at 2.99 percent a year interest rate over a 10-year period. That money was to pay for building a livestock barn and arena to be up in time for this year’s fair that opens July 8. That money was placed in a county account out of which the commission paid bills for the project at the instruction of the fair board.

Structure Steel of Canton was hired to put up the barn. The fair board expected to pay back the $400,000 out of pledges made to the barn project last July. Those pledges are to be paid back over a five-year period.

However, earlier this month the fair board terminated its contract with Structure Steel. It cited delays in the project that was to have begun in early spring and the contractor’s failure to return what the board calls unearned money.

Jeff Simmons, owner of Structure Steel, said he could not begin the project because the fair board had not supplied the necessary permits.

“I can’t proceed without a permit,” Simmons said. “There has been no permit issued. That absolutely not in my contract to provide the permit. Legally I can’t proceed.”

According to the contract between the fair board and Structure Steel acquiring permits was the responsibility of the fair board and any subcontractors working on the project.

The key dispute centers around almost $200,000 that Structure Steel received that the fair board said it did not earn.

According to the contract, payment was to have been made in four disbursements. The first of $99,825 was to be made at the execution of the contract. The next two were to be made after the work was completed in installments of $99,825 each. A final payment of the remaining balance was to be paid after the work was completed.

According to Randall Lambert, chair of the fair barn committee, the first $100,000 paid is not disputed.

However, the next two payments totaling close to $200,000 have come under contention. The county commission administrator said she was authorized to pay Structure Steel by fair board president Jim Gore. Gore has publicly called those payments mistake.

Since the termination of the contract the fair board and contractor have threatened lawsuits.

Right now STI Construction from Powell is erecting the barn, with the steel structure almost up and the concrete floor scheduled to be poured on Thursday.

Of the remaining $100,000 from the original county loan approximately $3,500 remains, according to the commission administrator.

Gore, recently elected fair board president, confirmed that the board voted at a special meeting Thursday to borrow money from a bank.

“We don’t know for sure,” he said. “That’s the way it looks.”

He referred other questions to Lambert, who did not return a phone call made to his office by press time.

“We would be glad to be of help if the financial information and bond counsel had passed muster,” Burcham said. “Unfortunately, in this case, one of the issues that didn’t have time to be addressed was the public entity status of the fair board.”