Three Ring Studios bond OK’d
The Newton County Industrial Development Authority (NCIDA) voted to approve a resolution to issue $106,700,000 in industrial revenue bonds for the Three Ring Studios project at its April 26 meeting.
IDA member Frank Turner, Jr. told the members that the bond validation with the Newton County Superior Court would be filed April 27 for a hearing before Judge John Ott, scheduled for May 15 at 9:30 a.m.
“We are very excited about the future of Three Ring Studios in Newton County,” Three Ring Studios, LLC President Rahim Charania, said in a statement provided by Turner. “This facility is anticipated to employ over 3,000 people when it is completed and many of them will be Newton County residents.
“So far, over 60 percent of the vendors that have worked on the site development are Newton County businesses. We intend to continue that trend so we can build a stronger community for us all. The growth in jobs and business opportunities, together with the fact that neither the County nor the City will ever have any liability for the payment of the bonds, makes this a great opportunity for the County and its residents.”
The Covington News asked Turner additional questions regarding the bond issuance and the Three Ring Studios project. The questions and answers are below:
The News: How much initial financial investment is Three Ring
making in the project?
Turner: Three Ring Studios has committed to invest $106,700,000 within 10 years. The pace of investment will be determined by the studio and the timing will be largely driven by market demand. Our understanding is that the studio intends to initially construct 7 sound stages (at over 36,000 sq. feet each) along with office and warehouse space as part of its initial campus.
You may have already seen this but Three Ring’s website is http://threeringstudios.com.
The News: Will the IDA be basically the landlord for the studio?
Turner: Yes, a lease will be in place for up to 10 years under which the NCIDA will
remain the owner of the property and lease it to Three Ring Studios, LLC. The NCIDA will not have any liability or responsibility with respect to the operation or maintenance of the studio.
The News: Should Three Ring no longer require the studio, what would happen to it?
Turner: It can be converted to other industrial uses allowed by zoning and restrictive covenants but Three Ring Studios, LLC would remain bound to the $106,700,000 investment commitment.
The News: How are the bonds paid back?
Turner: The tenant makes rental payments to the NCIDA equal to the debt service on the bonds. The News: Would the taxpayers of Newton County be responsible for the bonds? Turner: No, these are tax- able industrial revenue bonds repayable solely from the rent paid to the NCIDA by Three Ring Studios, LLC. Neither Newton County or any governmental entity is liable for payment of the bonds.
The announcement of the intention to issue the bonds is published in the Public Notice section of today’s paper.
Other IDA bond issuances
The Newton County Industrial Development Authority (NCIDA) has issued industrial revenue bonds for other projects over the last ten years. NCIDA member Frank Turner, Jr. provided this list:
Vestar (now Elmet Technologies), $30MM bond issue in 2012. As of April 2016, when the bonds were retired, 28 jobs created and $38.8MM of private funds invested in the community.
SKC phase 2, $50MM bond issuance in 2010 and $60MM in 2014. As of March 2017, when the 2010 bonds were retired, 75 jobs created and $109.9MM of private funds invested in the community.
Michelin/Tread Technologies, $18MM bond issuance in 2010. Bonds to be retired in 2021. Company committed to invest $18MM and retain 173 local jobs.
Merryvale Assisted Living, $645,000 tax exempt bond issuance in 2008 for expansion of facility.
Merryvale Assisted Living, $7.35MM tax exempt bond is- suance in 2007 for acquisition of facility.
Turner said all bonds are backed solely by the rental payments from the industry/ companies to the NCIDA and there is no liability for repayment on the part of the NCIDA, Newton County or any other governmental body.