A plan to raise money for improvements at two state parks has been put on hold until the Legislature can clarify a section of state code, members of the state Economic Development Authority were told Thursday.
Executive Director David Warner said attorneys have recommended the authority put on hold the planned $24 million bond sale to benefit Cacapon Resort State Park.
Last year, the Legislature approved a bill allowing the state to sell up to $52 million worth of bonds to fund improvements at Cacapon and Beech Fork state parks. The bonds would be sold in two groups, with Cacapon getting the first funds.
The authority approved the bond sale in April. The bonds will be paid back with funds from the state's Excess Lottery fund.
However, Warner said when attorneys drafted and reviewed the final agreements prior to the sale, they raised red flags. He said bond attorneys did not feel the bill approved by the Legislature did not clearly define how the Lottery funds would be paid out.
Excess Lottery funds are used to pay off bonds issued by various agencies, including the School Building Authority. Since bonds issued by multiple agencies, the statute needed to define which agencies get higher priority in case there is a funding shortfall.
However, bond attorneys did not feel the law passed by the Legislature provided enough clarity on that priority. That lack of clarity prevented them from finalizing the legal covenants that had to be drafted for potential bondholders.
"The lawyers weren't comfortable closing on the bonds because of that technicality," Warner said.
He said the attorneys said the matter would have to be dealt with in either a special legislative session this year, or during the regular session next year.
Commerce Secretary Keith Burdette said Gov. Earl Ray Tomblin has not decided to call a special session this year. Burdette said the governor would like to have additional items to place on a special session agenda before calling the Legislature into session.
Warner said even if the governor were to call the Legislature into session later this year, it would likely mean the bond sale and improvement projects at the park would not be able to occur until next year.