City Council could option healthcare reserve fund to buy Palmett - - Columbia, South Carolina |

City Council could option healthcare reserve fund to buy Palmetto Compress

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Columbia City Council voted to have a second reading of an ordinance that would purchase the Palmetto Compress Building. It would be renovated and sold to a developer, but the controversy comes in how the city plans to pay for the $7 million operation.

There were three options to fund this purchase: money from the hospitality tax, the water and sewer fund, or the city's retiree health care fund. The water and sewer fund was taken off the table during the meeting.

"The last building of its kind in the US," said Mayor Steve Benjamin. "A gateway structure, an historic building and for some of us, that's important and something we want to see maintained."

Benjamin says the best option is using the city's reserves.

"We've aggressively worked by using our resources effectively to have just under $50 million in the bank. So it's money that's there," said Benjamin.

That fund is used to help pay for retiree healthcare. Benjamin says using that money does not jeopardize any health care benefits.

Councilman Moe Baddourah disagrees.

"I don't think that we should touch that," said Baddourah. "This is money that employees of the City of Columbia have been putting in for all these years and that money should stay in that fund."

There is also a concern from Councilwoman Leona Plaugh that after the $5.6 million purchase price tag, renovation and monthly fees could skyrocket the total price of the project past $7 million. She says taxpayers would have to foot that bill.

"What happens when we lose money? That means that loss has to be funded by water and sewer or by general fund. It's spread out," said Plaugh.

Benjamin says this "reserve" fund or healthcare retiree fund makes the most sense.

"We can move forward using our reserves, and I believe it's the right way to go, it's the conservative way to go and an aggressive way to go for economic development," said Benjamin.

City Council will have a second reading where they'll further discuss this retiree healthcare fund option and hospitality tax. Once it's decided where the money is coming from, a separate committee will be in charge of picking the developer.

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