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Business/Money

June 10, 2014

River Ridge secures $20M in bonds

Money to pay for transportation, utility improvements

JEFFERSONVILLE — A second bond in less than four years has been issued for River Ridge Development Authority at more than double the amount of its first.

Your Community Bank, in partnership with several other Indiana and Kentucky banks, is issuing River Ridge $20 million in bonds to cover the costs of road, sewer and rail improvements as well as River Ridge’s $6 million commitment to the heavy haul road.

The 6,000-acre industrial and business park received $8.5 million in bonds from Your Community Bank at the end of 2011.

The bonds were issued despite Clark County Commissioner John Perkins’ threat to file a private lawsuit against River Ridge for not sharing excess funds with surrounding communities.

According to the bond certificate, “no lawsuit has been filed nor has the nature or basis of any such potential litigation been conveyed by Mr. Perkins.”

However, Perkins said that his attorney is still filing a lawsuit on his behalf as both a private citizen and Clark County commissioner. He said he is going to ask for a declaratory ruling on the original agreement 14 years ago that stated Charlestown, Utica, Clark County and Jeffersonville will receive some amount of River Ridge’s “excess funds.”

“It has been conveyed,” Perkins said of the lawsuit, despite the certificate’s claim that it hasn’t. “... It is going to be pending in the next couple of days.”

River Ridge Executive Director Jerry Acy said the increase to $20 million in bonds from the 2011 level is vital in the park’s continued growth.

“In order for us to achieve our mission here, it’s going to be a never-ending process for 15, 20 years to build out the infrastructure,” Acy said.

Road improvements that the bonds will pay for include Trey Street, River Ridge Parkway and Salem Road. For standard road construction of three lanes with curbs and gutters, each foot costs $750. That totals about $3.9 million per mile.

“Our first bond issuance we only built just a couple miles of new roadway,” Acy said. “It just does not go very far.”

About a quarter of the bond will be used for the heavy haul road that will connect the east-end bridge interchange to Ind. 62. The road will be equipped to handle transportation of goods from River Ridge and the bridge to the Port of Indiana-Jeffersonville. The corridor will provide direct access to River Ridge’s megasite, a 1,730-acre site that could be used for an automotive manufacturer.

River Ridge is beginning to get the infrastructure in place to serve this megasite, Acy said.

“We are getting inquires on a regular basis for larger type developments,” he said.

Acy said that building out essential services helps attract businesses. Past road improvements helped secure Amazon, American Fuji Seal and America Place because their respective sites were ready for development.

“So its just a part of the development process to put in the roads, and you can’t wait,” Acy said. “To have real good marketable sites, you’ve got to have your roadways in place and easily extendable utilities to get to those sites.”

Michael Bauer, chief credit officer at Community Bank Shares of Indiana Inc. — Your Community’s parent company — said that the partnership with five other banks was vital in securing the bond.

“We have excellent working relationships with other community banks throughout the area, and we knew this was an excellent chance to support the growth of what has become an economic powerhouse for Indiana,” Bauer said in a press release.

River Ridge has generated an economic impact of more than $1 billion through its 40 companies that employs more than 6,000 people. Acy said that tax revenues from these businesses will help pay off the bond, which has an interest rate of 4.6 percent, over the next 20 years.

“If we had not had any new development, we would not have been able to do 20 million,” he said.

One Southern Indiana President and CEO Wendy Dant Chesser said the bond not only helps River Ridge, it also helps the communities around it.

“Typically, private investment follows public investment,” Dant Chesser said. “So as River Ridge reinvests in its infrastructure, then private companies will be more inclined to invest in that area as well.”

This means that nearby areas can lead to development of more commercial businesses.

“River Ridge is likely to attract what we call primary jobs,” she said. “Those are the jobs involved in manufacturing that pay a wage that allows that family to have discretionary income.”

Those families will then spend their income on groceries, a mortgage, new cars and other goods — prompting growth in those sectors for “all of the things that make our community complete.”

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