County accepts $7 million offer for Ball Ground recycling plant
by Joshua Sharpe
June 18, 2014 12:59 AM | 2451 views | 4 4 comments | 14 14 recommendations | email to a friend | print
CANTON — Cherokee County is working on a $7 million deal to sell the controversial Ball Ground Recycling facility, after shooting down a $4.2 million offer in March.

The Board of Commissioners and the Resource Recovery Development Authority voted unanimously Tuesday to give preliminary approval for a lease-purchase with Peach State Organics, which hopes to operate the shuttered plant on Highway 5.

The RRDA, which owns the property and includes resident Robert Morrison and four commissioners, approved a letter of interest saying the company will pay $30,000 a month for 36 months, before paying off the rest of the $7 million in 2017.

The board stipulated the first year of payments for the plant would be paid up front. County Manager Jerry Cooper said payment was planned to come Oct. 1.

Commission Chairman Buzz Ahrens said he was hopeful about the deal, but there is still work to be done to see it through.

“Now, it’s a matter of getting an agreement together that will be an actual lease-purchase agreement,” he said Tuesday night, adding the company — whose owner is based in Indiana — is working on financing.Commissioner Brian Poole, the only commissioner not on the RRDA, said he voted with the rest of the board because he wanted the RRDA to handle the situation, not necessarily because he approved of the letter of interest. The RRDA recommended commissioners approve the offer.

“I voted to let the RRDA handle it; that’s what they chose to do,” he said Tuesday night. “I hope we just get it up and going again for the taxpayers of Cherokee County to help them out with that $100,000 per month.”

The county has been trying to unload the facility since its operator, Jimmy Bobo, went out of business and taxpayers were left to pay $100,000 a month in bond debt. Commissioners created the RRDA in 2006 to guarantee $18 million in bond debt for Bobo to move the facility. Cherokee still owes around $16 million.

Poole said the county might be taking a bit of a risk because Peach State Organics is new to Georgia and it is still unknown how a lawsuit against the county from Cowart Mulch over the facility will turn out. Cowart Mulch, a Sugar Hill-based company, attempted to buy the facility earlier this year and sued when the county turned down its $4.2-million offer after the county had given preliminary approval.

Commissioner Harry Johnston, who had been the lone vote against the Cowart offer because he said he felt the county could get more money, doesn’t feel the lawsuit will make a difference.

“We don’t think (they’re) going to win,” he said Tuesday night. “It really isn’t an issue. The potential buyer is aware of it and has taken that into consideration.”

After voting for the Peach State Organics deal, Johnston said he was thankful to have more money, though $7 million is still short of making Cherokee whole.

“This still is far short of what we’d like it to be; we’d like it to be $18 million,” Johnston said. “This is clearly much better than the Cowart offer. It is also above the liquidation value of the equipment and land sold individually.”

Peace State Organics is being started by Don Willis, who is also president and CEO of Green USA Recycling and Second Cycle Recycling, which are in Indiana.

In a telephone interview Tuesday night, Willis said he felt good about the deal with Cherokee County.

“I feel very confident on our end,” he said. “We have already spoken to our lenders and investors. They’re excited about the project. Now, what we’re going to be doing — since it’s been approved — is going through the due diligence period.”

Willis said he planned to come to Georgia to inspect the equipment on the site and determine exactly what would be involved in operating the site.

Commissioner Ray Gunnin said he hopes the deal works out.

“I’m just glad to see something moving,” he said Tuesday night. “We’re still hashing it out. I hope it comes to fruition and we get a good operator in there. It’s been two years now, and this is (about) the best offer we’ve got. It’s quite a bit more than what we’ve been offered before.”

Comments
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Truth Sabre
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June 19, 2014
I still don't understand why the commission does not market the plant and seek bids.

Also, why not open the plant and operate it.

When it was open Cherokee citizens had a free place to dump yard waste and received discounts on mulch and soil products (about 30% cheaper than HD). Now we get nothing and the plant rusts and rots.

Bobo was open at the plant 30 months, appears to have paid about $1,800,000 in rent ($60,000) per month - and employed about 50 people. Wasn't this a better deal for the county?

Truth Sabre
Karl Marx
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June 19, 2014
Truth, The commissioners are such a big hurry to make this just "Go Away" they will entertain almost anything. They think we are all stupid. The problem is now they have so badly mishandled this I'm not sure they are capable of doing it. I don't trust them, do you?
Karl Marx
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June 18, 2014
Nice reporting Tribune. Cowart’s offer was $4.2 million amortized over 25 years for a total $6.9 million. So we have to defend a lawsuit which will cost millions for an additional 100K. Great move Commissioners! After all it’s not your money you’re throwing away.
DetailsAndLearn
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June 21, 2014
The $7 million dollar offer is over three years. Much better than the previous offer of payments over 25 years. So, what is Steve West going to do now that they have resolved his sole running point? This offer is by far the best. And yes, the place had been marketed for bids. Simply put, we owe $16 mil on something only worth $6-7 mil at best. And Bobo couldn't keep the biz running. Towards the end, the discounts were gone and he was charging to dump there. When the housing market crashed, people quit clearing land, therefore he lost his raw materials. Not just anyone can operate this plant. You have to have an excellent understanding of the equipment, the industry, workers' training and knowledge, demand\marketing,...The list goes on. Bobo had been in biz for years and couldn't do it.
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