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Some see defaulting on bonds as way to avoid tax hike

If some Grady County taxpayers have their way, the Board of Commissioners will walk away from the Tired Creek Lake project and default on the bonds issued to finance the construction of the lake.
Such a drastic approach was the suggestion of local residents John Monds, Dr. Jeff Bivins, and Alan Parks.
On Tuesday, county commissioners held two in a series of public hearings on a proposed 23.11 percent tax increase, which is driven in part by expenses related to Tired Creek Lake.
A large number of taxpayers attended both sessions, which were held in the main courtroom of the Grady County Courthouse to accommodate the large number in the audience.
“The only way for the county to survive is to default. There is no shame in defaulting. Municipal bonds fail all the time,” Dr. Bivins said.
Bivins said that the county’s credit rating would go “in the toilet” but he said that would be a good thing because it would force the county government to operate within its means.
Monds told commissioners to “seriously consider defaulting” and “cut the losses” on the lake project.
“There will be implications to defaulting, but it should be seriously discussed,” Monds said.
Parks, who said he was representing the elderly and citizens on fixed incomes, said the lake project had been an issue for 63 years. “It started out wrong 63 years ago and it’s been wrong ever since. You (the board) have the opportunity to do the right thing,” Parks said.
“Default on it and get it over with. Break the dam and let it go. I don’t really care,” Parks said.
Commission Chairman Ray Prince said that was not the only option the county has.
According to the chairman, the county is in talks to sell the lake.
“If not for the lake, our roads would be fixed and we would be in good financial shape,” Prince said. The commission chairman said selling the lake would relieve the financial pressure on the county.
Dr. Bivins asked who would purchase it and for how much. He predicted the county would have to sell it for a fire sale price in order to close on the sale.
“We’ve got people in mind and they have got some deep pockets. Hopefully we will be able to share it with the public very shortly because we’re not getting anywhere with what we are doing now,” Prince said.
“If that’s true Ray why not take the tax hike off the table?” Parks asked.
“We are looking at about eight months to get the sale done. I also don’t think it will be a three mill increase. We set it higher because we can always come down, but you can’t go up,” Chairman Prince said.
Commission Vice Chairman T.D. David said restructuring the county’s debt may be part of the resolution, but he said defaulting would not be helpful. “That would send up a red flag to everyone,” David said.
The Messenger reached out to other members of the board for comment on the deal Prince described Tuesday night, but neither Vice Chairman T.D. David nor commissioners Keith Moye and LaFaye Copeland said they knew any details of what the chairman was referring to.
The third and final public hearing on the county budget and proposed tax increase will be held Aug. 14 at 6 p.m.

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