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|$20 Million to Flow Into White Water Park Page II
|Governments bet on success
The financing for the project is as unusual as the idea itself.Instead of asking local governments to pay for the park, which will be built on public land, backers convinced Mecklenburg County, Charlotte and several Gaston County governments to guarantee their bank loans.
If the project makes money as expected, local officials won't have to cough up anything.
If it fails, though, Mecklenburg would owe the banks up to $7 million, and the other governments would be on the hook for as much as $6 million altogether.
The money to actually build the park is coming from two separate $10 million loans. One is from a group of seven banks, led by Charlotte-based Bank of America and Wachovia.
"It's a well-researched project, and the group that's behind it has really done their homework," said Cutter Davis with RBC Centura, one of that banks that's involved.
Eight local charitable foundations are combining to loan the other half of the money. The bank loans need to be paid back in seven years, Wise said. The foundation loans are for 10 years.
"It was an easy sell," said Ned Davis, president of the Colville Group, who helped line up private backing.
"People were very quick to see the value of it for the Charlotte community. We think it's going to be huge."
It was the unique nature of both the project and the business plan that hooked the Community Foundation of Gaston County.
"I don't think we'd ever have sent a contribution of $250,000 to this thing," said foundation president Ben Rudisill.
But a loan -- with the promise of a 5 percent return -- was a different matter.
"I think people from all over the Southeast will visit this," Rudisill said. "It's extremely exciting what this could do for the whole area."
Fund raising isn't over, though. The group still needs $5 million in individual donations and state and federal grants to cover the $25 million final price, which includes boats, safety equipment and furnishings.
The banks have agreed on another loan to cover those costs once the group has enough private commitments, so that the project can go forward.
(from the Charlotte Observer)
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