Car Exec Refuses to Disclose Lease Amount

David Hitchcock, director of Louisiana assembly operations for the controversial V-Vehicle Company refused to say how much the company is paying Guideco Properties, LLC to lease the old GM Guide Building for its proposed car manufacturing plant. Guideco is a front company for Ruston businessman James Davison. A lease between the two was negotiated last month, (see our story here) but the documents on file at the Ouachita Clerk of Court did not disclose the lease amount.

Robert E. “Bob” Fudickar, Director, Technology Industry for Louisiana Economic Development was also asked by LPNO if he knew the lease amount. He said he did not know, as it was an agreement between the two companies and did not involve his department.

The reason it is an issue is that theoretically, the taxpayers of Louisiana could have to pick up the lease or even buy the building, should V-Vehicle not be successful.

Section 4.05 (B) of the Cooperative Endeavor Agreement says:

(B) Purchase Option. Guideco shall grant the State an option to lease or purchase the Facility (including the land; improvements; personal property; rights, servitudes and privileges pertaining to the land; streets and roads abutting the land (to the center line thereof); and permits, licenses, certificates of occupancy and governmental approvals pertaining to the land or improvements (to the extent assignable) upon commercially reasonable terms and the following conditions:

(1) In the event of any of the following events:
(a) Termination of the Company’s lease of the Facility resulting from a material uncured breach by the Company of the terms of its lease agreement with Guideco;
(b) Cessation of Operation or vacating of the Facility by the Company (other than during a period of Force Majeure as provided by Section 4.08);
(c) Delinquency of more than six months in the payment of reimbursement due under Section 4.07;
(d) Failure to commence Phase III by March 1, 2010;

(2) the State at its option may:
(a) assume the Company lease on the same terms;
(b) enter into a new lease on the same terms as the Company lease; or
(c) purchase the Facility at the following price:

Public Forum

Both men were at a public forum at the Ouachita Parish Library sponsored by the Garden District Neighborhood Alliance. Alliance President Drew Fluke introduced the several public officials at the meeting, including Monroe Mayor Jamie Mayo, West Monroe Mayor Dave Norris, Ouachita Parish Police Jury President and District E Juror Shane Smiley, District F Juror Pat Moore, District C Juror Walt Caldwell, and Monroe City Council District 1 Councilman Jay Marx.

While the forum wasn’t as contentious as some of the more publicized Congressional Town Hall Meetings seen last summer, the mood of the couple of dozen attendees was hardly fawning to the politicians who answered questions for an hour and a half.

Some typical questions were:

“Can we see a picture?”
“What makes this car different?”
“How much kicking of the tires did the state do?”
“Can’t we do this another way?”
“Why do we have to put the money up front?”
“Why not local contractors?”
“Who is putting up collateral? These guys are billionaires!”

Surplus Funds at Monroe and West Monroe

One question that elicited extended discussion was whether and how much surplus the governments have. Mayo was asked, “Don’t we (Monroe) have a surplus?” To which he replied, “The city has a surplus.” Later in the discussion another question was, “Couldn’t the surplus pay for the already committed funding rather than ask the voters for a tax?”

Both mayors danced around that question, claiming that it wouldn’t be good fiscal management to deplete their funds, lest an emergency occur. However, Norris admitted that West Monroe had about $5 million extra and Mayo said Monroe had about $5.8 million.

One audience member was concerned about the effect of increased property taxes on the area’s major employers, fearing that this might encourage them to close up and move to a more business friendly environment. A Michael DeVault story in The Ouachita Citizen lays out which would pay how much.

5 Responses to “Car Exec Refuses to Disclose Lease Amount”

  1. Wascator Says:

    I say again: you have to cut the money off or at least keep it extremely tight, to get and hold the complete attention of politicians. Otherwise they start thinking they own it and us and get really arrogant, etc. Vote NO to the V-Tax. This thing is going broke, and the State (I.E taxpayers) will get hung with the entire thing.

  2. JohnMartin Says:

    Walter you exaggerate….some of the V-Vehicle principals are not billionaires……more like half or three quarters billionaires.

  3. Davison/V-Vehicle Lease Deal Still Secret « Lincoln Parish News Online Says:

    […] week we had reported that an executive of V-Vehicle refused to disclose the lease terms and an LED official said he did […]

  4. V-Car Story Changes – Again « Lincoln Parish News Online Says:

    […] Two months ago Monroe Mayor Jamie Mayo said “I’ve sat behind the wheel.” At a forum last week, Mayo repeated that assertion, and West Monroe Mayor Dave Norris said he too had “sat in the […]

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