“What’s going on is that, back in 2006 when life was rosy and no one expected an economic downturn, there was an agreement between the developer, the city, BLP and the (city's) brownfield authority,” Bonamy said. “When you go back to the mindset of 2006, nobody had an inkling there’d be an economic crisis like we had.”
This agreement laid out the need to provide changes at the Grand Landing property, one of which is electric system upgrades and power line burial — totaling about $1.9 million in work, Bonamy said. It would be paid for with funds from the Grand Landing bond.
“Over time, (the BLP) would reimburse the Grand Landing bond on the basis of what’s called net power revenue,” Bonamy explained. “We’re asking for a portion of that be returned to pay off these items.”
The payments would be remitted to the city as a result of payments made by electric power users on the site to the BLP, pursuant to the 2006 agreement.
“At the time (in 2006), we were told by Grand Landing they’d have everything up and running in five years,” Bonamy said.
This wasn’t the case, however, as the economy tanked, development stopped and the property ended up in receivership.
New developers purchased Grand Landing in 2012 for about $3 million.
The agreement with the BLP ended last month, yet there is more money that needs to be paid toward the bond for the utility improvements.
“The Board of Light & Power has produced $601,000, which has been repaid and used for Grand Landing payments," Bonamy said. "There’s still $1.2 million of costs still there. There is one more payment for that and then it is closed."
As of now, all sides are trying to come up with a solution that everyone can agree on — especially, BLP Chairman Jack Smant said, when there are some capital projects being eyed in the near future for the municipal utility.
To read more of this story, see Saturday’s print or e-edition of the Grand Haven Tribune.