Commissioners Approve Letter of Intent To Replace Failed Recycling Project

The Cherokee County Board of Commissioners last week approved a letter of intent with a Sugar Hill-based company that could lead to a new company assuming operations at the Ball Ground Recycling north of Canton.

Commissioners voted 4-1, with Scott Gordon opposing, to execute the letter of intent with Cowart Mulch Products. County leaders approved the letter at a joint meeting with the Resource Recovery Development Authority, which also approved the measure.

The letter is ”not a binding, finalized agreement,” but just outlines what will be discussed between the county and the company as they come to a conclusion of negotiations, said Ken Robin of Jarrard & Davis, the firm that represents Cherokee County.

This letter comes just five months after the county in December approved a settlement agreement with Jimmy Bobo, former operator of Ball Ground Recycling.

According to the letter, owner Chris Cowart would lease the property at 5861 Ball Ground Highway for $4.2 million, which includes all equipment and machinery at the facility. However, starting May 1, he’d make monthly payments to the RRDA in the amount of $11,853.63 per month until the amountis paid in full.

Cowart would have the option to purchase the property “in the event the tax-exempt bonds are retired through the RRDA exercising its option to call the tax-exempt bonds in or around mid 2017.”

Cowart would also agree not to dump, store or bury any hazardous waste, substances or materials on the property. Additionally, the county would also help the company obtain the necessary permits to allow the business to include composting bio-solids to produce fertilizers and/or soil amendment products, the letter states.

Both parties would also enter into a settlement agreement resolving allegations outlined lawsuits filed by Cowart against county commissioners in the United States District Court for the Northern District of Georgia and Cherokee County Superior Court.

The closing date on a formal agreement shall be no later than May 1, according to the letter of intent.

Gordon, who voted against executing the letter of intent, stated he felt like the current offer is below his minimum expectations of what the county should consider as an acceptable deal. However, for the sake of the county, Gordon noted he will work with the board “to put this behind us.”

District 3 Commissioner Brian Poole thanked Cowart for coming to the table and working with the county on coming up with a solid starting point.

District 1 Commissioner Steve West, who advocated for the county pursuing a deal with Cowart, added he drives by the 36-acre lot every time he makes the trip to Canton. While the Ball Ground Recycling venture was one of the “worst business deals” implemented in the state of Georgia, West said the county is unlikely to get any other offers on the property.

Since last year, West said Cherokee County has lost over $1 million due to the lack of an operator on the site. With that in mind, West said he believed this decision was the best way to move forward and help the county save money.

The commission in 2006 created the Resource Recovery Development Authority and backed up to $18 million in bonds, which were used to relocate Ball Ground Recycling to land along Highway 5 just south of Ball Ground.

The agreement stipulated Bobo was to make payments of the bond into an escrow account, but the county learned in late 2011 Bobo hadn’t been making the payments.

That forced the county to pick up the tab, which it will still be responsible for if it does not find a new operator for the site. Cherokee County has been actively recruiting and talking with possible companies to take over operations.

Ball Ground Recycling in 2012 filed for Chapter 11 bankruptcy, and the company was subsequently forced to remove itself from the property. The company was eventually dismissed from bankruptcy court, giving the county the green light to go after the company and Bobo to recover money from the failed deal.

The county commission approved a forensic audit at the request of a previous Cherokee County grand jury, which launched an investigation into the failed venture. The final tally of the audit’s cost was nearly a half-million dollars.

After several months of probing, a grand jury in August found no “prosecutable criminal case” with the venture and recommended the county divert its resources from investigating any criminal wrongdoing in the deal to finding a new operator for the vacant site.

Following the grand jury’s guidance, Wallace earlier this year closed the investigation into the case, a probed that included the Cherokee Sheriff’s Office, the Georgia Bureau of Investigation and Federal Bureau of Investigation.

Photo credit: Patch file