PILOT MOUNTAIN — The Pilot Mountain town council last week voted to place a lien on a local industrial building, hopefully to protect the town’s finances from a state demand to repay more than a quarter of a million dollars in grant money.
The saga began four years ago, when the town Board of Commissioners accepted a $400,000 economic development grant from the Department of Commerce, helping to pave the way for Elastrix to create 41 jobs in the town at its rubber compounding company.
The agreement called for the firm to create the jobs within three years, and when Elastrix created just nine of those positions, then shut down operations, the DOC asked for more than $300,000 of its money back. While it’s the business that fell short, ultimately the town is on the hook for the money if Elastrix cannot pay, which is where the firm apparently finds itself.
According to Michael Boaz, town manager, the falling price of petroleum affected the company. “It became cheaper to buy new rubber, rather than recycled.” Recycling rubber was the main service provided by the company.
According to town officials Elastrix had agreed to repay the money to the town in four installments, and made good on that commitment in June when it handed over $84,000. However, according to Pilot Commissioner Kim Quinn, Elastrix does not have the money to make any more payments, and the building, at 523 South Stephens St., is now on sale, listed at $1.8 million. It has a tax value of $534,520 according to Surry County Tax Map.
By placing a lien on the property, the town gets its payment if the building and ground sells.
“The decision was made to ensure the town’s best interest,” said Quinn in explaining the board’s vote.
Now the town is facing a Dec. 30, 2017, deadline to pay the money, though most involved seemed to believe the building would sell before the September 2017 deadline to make the December payment.
“This industrial property is one of the most attractive properties available in Surry County,” Quinn said, relating information she had received from the town manager and town attorney.
If the building doesn’t sell, the town can petition the Department for an extension.
Reach Eva Winemiller at (336) 415-4739