William Peace University has informed the Raleigh City Council that it will not seek the council’s approval to issue as much as $16 million in tax-exempt bonds.
The council delayed approving the university’s request last week after several residents raised concerns about William Peace’s interest in buying the Seaboard Station retail center, which has been in bankruptcy for more than a year.
The council delayed voting on the bonds until May 21 and asked William Peace officials to meet with community groups to address their concerns about Seaboard’s future.
In a letter delivered to the council this week, President Debra Townsley said there is “insufficient time to conduct community discussions about the unrelated issue of Seaboard Station.” She said that in order to meet internal deadlines, William Peace will use other forms of financing.
Townsley said the university would get back in touch with the council after it completes its discussions with community groups about Seaboard.
Several residents told the City Council last week that they feared the tax-exempt bonds would give the university more financial flexibility to acquire Seaboard.
University officials say the two issues are separate. Townsley also told the council last week that, should William Peace acquire Seaboard, it had no intention of closing the popular retail center.
William Peace had planned to issue new bonds through Public Finance Authority, a Wisconsin bond issuer that partners with private borrowers and local governments. Such bonds require approval from the largest governmental entity that is over the issuer, but Raleigh would have had no financial obligation to the bonds.
The university planned to use $9 million of the new bonds to refinance bonds it took out in 2004. The remainder of the money would be used to repay a $6.5 million loan the university took out from its endowment.
University officials say the bonds issued in 2004 can only be used for improvements on the William Peace campus, and that donors dictate how the money from the endowment can be spent.
Townsley’s letter to the City Council didn’t specify what other forms of financing William Peace will now pursue.