MARQUETTE - The Marquette County Board on Wednesday recommended the refinancing of West Branch Township's loan on the "W" building.
The township board requested changes to the loan from Marquette County, including changing it back to a principal and interest payment instead of the interest-only payment the township has been making for the past six months.
The county suspended the principal payment to allow the township to give a local community group better lease terms on the building. The K.I. Sawyer Community Association is using the building for a local fitness center, and the township agreed to charge them less monthly when the county agreed to allow interest-only payments.
The township also asked to have the interest rate reduced to 2 percent from 5 percent. A memo from township Treasurer Laurie Karpinen to the county board said the township had reviewed the original loan structure, including a balloon payment, past principal payment deferments, and overall payment history.
"It has been determined that the loan is not on track to be repaid on time with current township resources," Karpinen wrote in the memo. She said the township board is trying to repay the loan with current revenue sources, and the reduction in the interest rate would help it do so.
According to memos from Sawyer Operations Manager Scott Erbisch to the board regarding the loan, the monthly payment would go down to $1,188 with the drop to a 2 percent interest rate, from the original $1,550 per month under the 5 percent interest agreement.
The loan began in 2004, with a total amount of $235,000.
The county board's committee of the whole unanimously recommended the change to 2 percent at its Wednesday meeting.
Commissioner Bob Struck said the rate change serves both the county and the township well, and still covers the county's administrative and financing costs.
"It's not like we're loaning it to a business who's going to make money; it's to a unit of government who's providing a service to its people," he said. "This should be a win-win-win, where the county doesn't want to make money off West Branch Township, we want to help them help that part of the county."