A release-and-settlement agreement brought before and approved by the Lincoln County Board of Commissioners Monday night sealed the fate of one former local company for which many in the area, and across the nation, had high hopes.
As the Times-News previously reported, Lincolnton Furniture Company, once heralded as evidence of the return of manufacturing to the United States by both media nationwide and even President Barack Obama, abruptly closed its doors in January.
Since then, little has been heard about what went wrong. However, owner Bruce Cochrane had often discussed the unexpected costs associated with the venture, as well as the difficulty in securing capital.
In June, Industrial Recovery Services began auctioning off the furniture plant’s equipment on behalf of Carolina Trust Bank, who had repossessed the property at the end of May.
As a result, the county was forced to rush through an agreement with the bank regarding back taxes owed on the equipment.
According to a memo from Interim County Manager Martha Lide to commissioners, for the 2012 and 2013 tax years, the county assessed the company more than $56,000 in personal property taxes for the collateral equipment assumed by the bank. In an effort to secure the taxes owed, the county began to levy on the equipment for the 2012 delinquent tax, in addition to the current 2013 tax obligations.
“A dispute arose concerning the bank’s obligation to pay the back taxes,” Lide wrote.
However, Carolina Trust Bank agreed — so as to allow the auction to move forward — to pay 75 percent of the back taxes, while the county released the lien on the collateral.
County Attorney Wesley Deaton said Monday night that the agreement was the “best, most economic settlement.”
“The bank is willing to live by this decision,” he added.
Additionally, while Tax Administrator Clyde (Kep) Kepley said the company is still on the hook for the remainder of the back taxes, he noted that the county won’t likely see that money.
“There’s nothing there for us to go after,” he said.
This was not welcomed news to Commissioner Carrol Mitchem.
“I’ve just got a problem with the way that was handled,” he said.
Once the auction began, Kepley, who only recently came on board to lead the Tax Department, said it would have been impossible to go after the property. While predated by much of the situation, he acknowledged that better communication would be necessary moving forward.
“Let’s hope in the future, we act more hastily,” Mitchem said.