Defaulting on loan is not option, mayor says

CEDAR HILLS — In the final public forums before a June 28 special election in which voters will decide initiatives that would forbid Sunday store openings and any sale of alcohol in the city and a bond to refinance the city's struggling golf course, city officials and residents made their positions clear.

At the town meeting, held at Cedar Ridge Elementary School just prior to the regular council meeting, city officials fielded questions about the proposed golf course bond that would allow the city to refinance its remaining debt on the Cedar Hills Golf Course, which is slightly more than $6.4 million.

Mayor Mike McGee said the City Council has discussed the issue extensively and come to the unanimous conclusion that defaulting on the loan, an idea kicked around for a while, is not an option.

"We have far too much to lose," he said.

City attorney Eric Johnson said defaulting on the loan would draw the city into a long, expensive legal battle and would seriously hamper the city's ability to finance future projects.

If approved, the proposal would allow the city to issue a bond to cover the remaining debt on the course, up to $7 million. McGee said the primary purpose of the bond is to give city officials breathing room by creating lower, manageable payments while they decide what to do with the course.

According to a document prepared by Johnson, the current schedule for the loan calls for a $413,000 payment on Dec. 1 of this year and varying payments every six months thereafter until a final payment of just over $6 million is made on Dec. 1, 2007.

Officials said they are still considering options, with selling the course to a private party being the most likely choice.

When asked why anyone would want to buy a failing golf course, city representatives said they were confident they could find an interested party.

"The buyer would have to believe they can run the golf course better than we can," said Councilman Jim Perry, "which in my opinion is a very reasonable assumption."

McGee said the city has already been in contact with interested parties, and thinks finding a solution that will benefit the city and the buyer is a real possibility.

Some residents at the meeting expressed their frustration with the now-infamous course, saying it should not have been built and should be removed and redeveloped. One resident went so far as to encourage the council to investigate members of the previous administration for malfeasance in building the course.