State offers Morganton $5.4M recovery loan
Morganton council attendees ponder over the shared Hurricane Helene photos.
The City of Morganton has received the third largest allocation from the state’s new $100 cashflow loan program, but they may not need it. Only Buncombe County and Chimney Rock Village were awarded more.
The Department of State Treasurer (DST) has created a new $100 million interest-free loan program under the Disaster Recovery Act of 2024 to help local governments bridge the financial gap as they await FEMA reimbursement for Hurricane Helene-related recovery efforts.
Jeff Poley, DST director of disaster services and rural economic development, oversees the program.
Of the $100 million, nearly $74 million has been approved for local governments, including $5.4 million for Morganton.
City Manager Sally Sandy told the council during its regular monthly meeting on Monday, March 3, that about $670 million in recovery projects statewide were turned into the loan program for evaluation. The City’s current total damage is estimated at $46.27 million. A breakdown of this report can be found in The Paper’s March 1 edition.
DST evaluated Morganton’s submission and approved the City for a 0% loan up to $5,460,967.40.
The loan is a five-year payback with $1 due the first year, 10% in the second year, 20% in the third, 30% in the fourth, and 40% in the fifth year.
“It is meant to help you get to where are starting to get some of these projects — the projects that we talked about tonight — and get some reimbursement for FEMA,” Sandy said. “It requires that once you receive a FEMA reimbursement, you have five days to pay the state back, pretty quick turnaround.”
Sandy, the staff, the League of Municipalities, and Poley recently held a conference call to discuss a discovery they had made. The program was put together quickly, and some things were not well-defined, Sandy said.
The money would go toward debris removal and emergency response, which is defined as Category A and B in the FEMA process. For Morganton, this is just under $5 million and has already been spent.
“They hadn’t taken that into account. When we started reading the documents, we thought, ‘You give me this $5.4 million, and I get the emergency money that I’ve already spent, then I have to pay you back in five days. You really haven’t helped my cash flow for the other $42 million, which is what we’re struggling with,’” Sandy said.
DST is working on a solution to the dilemma, she said.
The council approved the loan agreement but will not close on the loan until the state returns with an answer. The City will continue to use its fund balance. The department may adjust the agreement or reallocate it to another municipality.
“Poley asked me to tell you all that we are further ahead than most places they’re dealing with in identifying and getting our FEMA damage assessment to this point. Us noticing this brings it to their attention, helps them with what other units are going to struggle with that they don’t know they’re going to struggle with,” Sandy said.
SPEED CHANGE
Late on Friday night, Feb. 28, the City was informed that the N.C. Department of Transportation had created an ordinance to lower the speed limit from 45 to 35 mph near the North Carolina School of Science and Mathematics-Morganton.
The speed limit would change on the U.S. 70 Bypass (West Fleming Drive) from U.S. 64 (Burkemont Avenue) to N.C. 18 (South Sterling Street).
Multiple pedestrian accidents have occurred in the West Fleming crosswalk at the entrance of the school. The most recent accident was Jan. 29, when two NCSSM students were hit by a Honda Civic. The driver, 42-year-old Trisha Crutchfield of Valdese, was charged with failing to yield to pedestrians in a crosswalk and failing to stop for a red light.
The road is maintained by NCDOT and falls within the city limits.
The council unanimously approved the ordinance.
REZONING
A public hearing was held for a rezoning request by T.L. Norman Land Company for 0 Ula St., off Kirksey Drive. The 20.64 acres are currently zoned as a Low-Intensity District. The proposal asks for the zoning to be changed to a Medium-Intensity District.
This would allow for more high-density residential projects along with some commercial uses. Overall, it would allow more potential housing. This proposal also fulfills the new ideas outlined in IMAGINE 2040, which was adopted in September 2024.
Realtor Allen Curtis, on behalf of the company, spoke during the hearing about the request.
“This is part of what our city and county needs, is this rezoning to be able to have more housing. … It allows a developer to use the performance standards and increase that density. As we all know, development is very costly, so the more units, the more possibilities they have,” Curtis said.
Curtis said their developer has been working with Development and Design Services Director Wendy Smith on their potential project of 250 townhouse/single-family homes.
The council approved the rezoning.
OTHER NEWS
In other news, the council:
- Held the first of two hearings for the Community Development Block Grant (CDBG) consolidated plan for the fiscal year 2025-29.
- Approved a hearing for a contiguous annexation petition submitted by Madcap Adventures, LLC, for three parcels of land by Enola Road and Pete Brittain Road; the hearing is set for Monday, April 7, at 6 p.m., at City Hall.
- Heard a Parks and Recreation update from Director Bryan Fish on where they stand after the hurricane. See story on 11A.
- Adopted the Unifour Regional Mitigation Plan.
- Approved the $30,000 Morganton Main Street Small Business Loan for The Hedge.
See story on 9A.
The council also recognized:
- A retirement resolution for Benefits Administrator Kathy Anthony, after 20 years with the Human Resources department.
- Retirement of City Engineer Mario Sclarandis, who’s worked for the city for 6 years; Sclarandis was not present; his retirement resolution will be read at a later date.
- Morganton Human Relations Commission’s celebration of Irish History Month and Women’s History Month, presented by HR Director Rus Scherer.
- 2025 Litter Sweep Week on April 2-9, presented by Jenna Cole, communications and events specialist with the Burke County Chamber of Commerce.
Saydie Bean is the municipal and courts reporter. She may be reached at 828-445-8595, ext. 2011, or saydie@thepaper.media.
Related
After 20 years with the City of Morganton, Benefit Administrator Kathy Anthony bids farewell to city hall.
