Open letter to the Libby School District
To the Editor:
We have been watching the sale of the Lincoln Building with great interest for several months and would like nothing better than for this project to work and brighten our downtown. We do, however, have reservations about the feasibility of the project and have concerns and questions in regards to this sale. As citizens, taxpayers and local business people we have the following and other issues that we would like answers to.
1. Is there any communication (a commitment letter for example) from a bank or other lending institution to indicate any attempt has been made to secure funding for this project? This is a standard practice in many real estate transactions.
2. It is our understanding that one of the major issues in selling this building was to save it from demolition. With that said do you have a business plan with feasibility studies, cash flow analysis, etc. to assure this is a viable project that can restore the building and generate adequate income to support the debt required for said renovation.
3. At what stage is the current buy/sell agreement? It is our understanding that it was supposed to have closed by now. If it is past the closing date, have you requested some kind of proof that the buyer is talking to a bank, or have you requested a possible conference call or other communication with the buyer's lender?
4. We have seen in the newspaper that the buyer is giving away a structure on the property. How can they give away something that is owned by the Libby School District? Remember the sale has not occurred.
5. Work has been allowed to start in the building, not something that is typically allowed before a sale is completed. Again, it is our understanding that demolition is occurring in the building. What is happening to the items being removed from the building and is there any salvage value to these items?
6. Do you have from the buyer the proper building permits, workers compensation insurance, general liability insurance and any other documentation that may be required for a project of this magnitude?
7. What protection do you have from lawsuits, mechanics liens etc., from allowing work to start without a completed sale? Do you have signed lien waivers from everyone who is doing work on the building? It appears to us that you have opened the school district and taxpayers to liability issues.
8. Why the hurry to allow someone into the building prior to closing the sale? Projects like this are complicated and take time to put together and often are not doable with conventional bank financing without substantial capital contributions by the applicant, typically 25-30 percent minimum of the total project. Again is there any proof that the buyers are talking to a lender?
9. It is our understanding that board members have invested personally in this project. If true, what kind of conflict of interest issues are there and have those issues jeopardized prudent business practices?
We are available to meet with you and the board to discuss these and other issues. Please let us know the best way to communicate the answers to these questions to us. Our preference would be to meet in person, but we can be reached at 293-4109 and ask for Gary Spencer or mail correspondence to Gary Spencer, PO Box 580, Libby, Mt. 59923.
Gary Spencer
Libby