Larry Obrecht has offered to loan the Polly Ann Trail Management Council (PATMC) $100,000 of his own money so it can be reimbursed grant money from the state.
‘It’s just a cash flow issue,? said Trail Manager Amy Murray. ‘I think it’s pretty nice for someone to come forward and do this.?
Not everyone agrees.
‘My first, initial opinion is government entities can’t borrow from private citizens,? said Oxford Township Trustee Sue Bellairs, who sits on the trail council. ‘Personally, I really don’t think it’s legal. I’m not absolutely positive, but I don’t think it is.?
Obrecht, a former Oakland County Commissioner who lives in Orion, served as project manager for the trail surfacing and M-24 bridge construction. He’s employed as manager of Oakland County Animal Control.
The $100,000 loan he’s offering would be used to help pay the contractor who resurfaced the trail earlier this fall.
A total of 10 miles of trail running from Bordman Road in Addison to Indianwood Road in Orion had to be resurfaced because the original surface (with its large crushed stones) laid in fall 2005 was reported to have a rough, rocky-feeling that drew numerous complaints from trail users.
It cost an additional $326,240 to give the trail a finer, smoother stone sand surface suitable for all users.
Grant money from the Michigan Department of Natural Resources will be used to cover the resurfacing cost.
‘It’s all grant money that’s paying for it,? Murrary said.
However, in order for the trail council to obtain the grant money, it must first submit copies of the contractor invoices and the cancelled checks that paid them to the DNR.
‘You first have to pay the contractors and then you can be reimbursed by the state,? Murray said.
Only problem is the trail council doesn’t have enough money to pay the contractor.
‘Since the resurfacing followed right on the heels of the other development, the cash situation is pretty lean,? Murray said.
That’s where Obrecht’s offer to loan $100,000 of his own money comes in.
If the trail council accepts his loan, it can pay the contractor, be reimbursed with grant money from the DNR and in turn repay the loan from Obrecht.
‘If somebody’s willing to make the money flow start, that’s all good as far as I’m concerned,? said Murray, referring to Obrecht’s offer.
‘I’m just worried about the legality,? Bellairs said. ‘Even if you wanted to do it, I don’t think legally you can do it.?
‘When you get that little inkling that it’s not right, it’s not right,? she explained. ‘If you have to think about it and get attorney opinions, you shouldn’t be doing it. That’s always kinda been my theory. It usually always works out.?
Oxford Township Treasurer Joe Ferrari, who also sits on the PATMC, also does not approve of this type of loan.
‘I don’t think that it’s appropriate,? he said. ‘I feel that government should never take loans from individuals.?
Gary Rentrop, attorney for Oxford Township, did some quick research at this reporter’s request and did not find any law against this sort of thing.
‘I don’t see any prohibition against (government) borrowing from an individual,? he said.
However, Rentrop noted this concept is a new one to him. ‘It’s pretty strange,? he said. ‘In 35 years of municipal work, I haven’t ever seen anybody loan money to a municipality. I’ve seen banks, but never an individual.?
The PATMC, which made up representatives from Oxford and Orion townships and the villages of Oxford and Leonard, must still vote on whether to accept Obrecht’s loan offer.
‘It is a slightly unconventional way of doing it, so they need to basically, on record, accept (the) money from the private source and commit to repay that source from . . . the DNR grant,? Murray explained.
Should officials accept the money, it’s Murray’s understanding the trail council would not be charged interest on the $100,000 from Obrecht. ‘It’s not a transaction anyone’s going to benefit from materially,? she said.
The trail council’s ‘cash flow issue? concerning the resurfacing project doesn’t surprise Bellairs. She said every time council members asked Obrecht ‘where the money’s coming from? for something, ‘he always says ‘It’s all taken care of. I’ve got everything taken care of.??
‘That’s all Larry ever would say,? Bellairs said. ‘Those are his famous words.?
‘There’s no way that we should have set ourselves up to run in a potential deficit that we’d have to borrow money to repay,? she noted.
‘We asked a lot of questions at the Polly Ann Trail level ? what’s going on, how are things going ? Larry’s standard answer was, ‘I’ve got it covered,?? Ferrari said. ‘That’s fine. If he’s got it covered, then he’s got to have it covered. So, hopefully he’s worked something out with this contractor.?