Here’s the story. But I saw it first at the all-knowing www.BooneWeb.com.
The Tweetise Railroad is more than a railroad – it’s an economic engine for Watauga County. This well-written story covers all the bases, and the last paragraph sums it all up:
The Watauga County Board of Commissioners and the county’s Tourism Development Authority have proposed an economic development incentives partnership with Tweetsie Railroad to keep the theme park in the county. The proposal includes purchasing an interest in Tweetsie land and providing an annual marketing subsidy.
Tweetsie’s Recent History
A potential threat to Tweetsie’s remaining in the county surfaced two years ago when land leases critical to the park’s operation came up for renewal, and the park’s principals faced difficult negotiations to extend those leases.Tweetsie Railroad, Inc. owns 87 acres of the park, but leases three additional tracts totaling approximately 188 acres. Ownership of those three tracts is split among multiple owners.
At the time of the lease negotiations, Tweetsie principals began exploring alternative sites for the theme park. According to information in the county’s report, Tweetsie has optioned a tract of more than 300 acres in Wilkes County as a contingency if the Watauga County leases cannot be successfully renegotiated.
Complicating the situation is a mandate to sell the theme park’s controlling stock. Before Tweetsie’s found Harry Robbins died, he and his ex-wife Revalle entered an agreement to pursue the joint sale of the controlling stock. Robbins’ widow Barbara and Revalle own 100 percent of the Class A controlling stock, and trust instruments require that the stock be sold.Potential third-party buyers of the stock were interested in the land for commercial development purposes—not for continuing the theme park operations.
As a result, Harry Robbins’ son Chris, the current president of Tweetsie, has negotiated terms with the two trustees that would allow him to purchase a significant block of stock and become the controlling shareholder. Robbins has arranged financing with BB&T to enable the company to reorganize its stock, make improvements to the park and develop adjacent property to create another income stream for the park.
With regard to the leases, in 2006, Tweetsie successfully negotiated a lease agreement on one tract through 2065. In 2007, Tweetsie successfully negotiated with the majority owners of the two additional tracts to extend their leases through 2065. However, the minority owners of the two tracts want to sell their interests.
The County’s Proposal
Under the terms of the proposal, Watauga County will purchase the minority owners’ interests in the two tracts for $3.15 million and then lease the land to Tweetsie for $1 per year for six years. The county would own 46.34 percent interest in a 46-acre tract and 34.75 percent interest in a 96-acre tract.The money for the property purchase will come from the county’s general fund, and the county may borrow funds as well. The county’s Tourism Development Authority will provide $200,000 of the purchase price, and will also pay Tweetsie $150,000 annually for six years to market the theme park. Tourism Development Authority funds come from the occupancy tax visitors pay to stay in rental properties in unincorporated areas of the county.
Tweetsie’s Proposal
In return, Tweetsie has agreed to the following terms:
• Lease the county-owned land at full market rate after the initial six years
• Purchase the land from the county at a future date to be determined at $3.15 million plus interest
• Build a greenway on Tweetsie land along the Middle Fork of the New River and convey the land to the county or other public entity
• Invest at least $13 million in improvements to the park over the next 19 years
•Stay in the county as least as long as the county assistance package is in effect
Economic Drivers and RationaleIn the proposal report, the county provides a number of economic reasons for stepping in to assist Tweetsie. Among them is Tweetsie’s impact on the local economy.
In 2007, Tweetsie attracted more than 235,000 visitors, and a 2005 study showed direct and indirect impact of $27 million to the county economy. In 2007, Tweetsie paid $691,000 in state, federal and local taxes, with sales and property taxes accounting for $226,000 of that figure. In addition, Tweetsie employs 26 full-time staff members and more than 300 seasonal employees. The park’s 2007 payroll was more than $2.7 million.
The report also notes that Tweetsie has spent a great deal of money to resolve its lease issues and is now paying “much higher lease rates.” To resolve the remaining land issues and maintain a quality attraction, the report continues, “it was necessary to turn to the County for assistance.”
If the county does not approve the proposed transaction, the report states, “The BB&T financing [for Robbins’ stock purchase and park improvements] will not happen, nor will Tweetsie Railroad’s stock reorganization. The current stockholders will sell their stock on the open market, which will most likely result in the demise of the Tweetsie Railroad them park in Watauga County.”