FAIRMONT — The state Commerce Department is requiring that the town of Fairmont pay back part of a Community Development Block Grant that the town received in 2007 that was contingent upon a specific number of jobs being created by an economic development project that would provide sewer to an existing industry.
The $400,000 grant was for the construction of a sewer lift station to serve the Harger Lightening and Grounding facility located on N.C. 130 East. The grant was issued with the requirement that the company create 27 jobs. When the grant for the project was closed out in December after a number of extensions, the company had only created 10 jobs.
Acoording to Linda Vause, Fairmont’s manger, the town will have to pay the state back $251,093 for the jobs not created. The payments will be made in four equal installments over four years, Vause said.
Vause said that the first $62,773 payment to the state was made on July 15. She said she had attempted to negotiate either a lower payback or extend the number of payments but was unsuccessful.
“I could only get the state to agree to the four payments,” Vause said.
Vause said that she does not feel the town should be liable for such a large payback on the grant since the local economy has been so poor. She said that the grant agreement included a clause that said if there is an unforeseen calamity, act of God, or financial disaster the town can appeal to the Department of Commerce for a modification in the agreement.
“Shouldn’t a downturn in the economy that prevents business expansion and job creation fall under this provision? ” Vause said.
Vause said that although Fairmont must repay the state for the jobs that weren’t created by the company, the town still “ended up with a nice asset.”
“We have to pay more, but we now have a good sewer lift station that can provide service for future users,” she said.
Mayor Charles Kemp expressed his displeasure that the state is requiring the repayment during a time of a weak economy.
“I personally believe that it’s unfortunate that we have to pay the state back during a stagnant and low revenue generating economy,” he said. “‘I have reached out to both Rep. Richard Hudson and Commerce Secretary Sharon Decker for help. They are studying the situation.”
According to its website, Harger Lightening and Grounding is a full line supplier of lightning protection and grounding equipment for the communications and electrical fields.