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Mayor's GCC committee to present its deal to councillors tonight

Posted October 9, 2012

Mayor Mike MacEachern will convene a special meeting of council tonight in closed session where councillors will be asked to support a confidential proposal that would obligate New Tecumseth to service/purchase what's believed to be an outstanding mortgage of $1.3 million owed to members of the Gibson family by the Gibson Cultural Centre Corporation (GCC).

In exchange, the Town reportedly would own the property, and work out a lease-back type arrangement whereby the GCC continues to operate as an arts centre but on a smaller scale. Those details, including issues the Town had over food and alcohol sales rights at the NTRC, could be issues in this case too. Alliston Rotary Club leases space on the second floor of the three storey building on Tupper Street but It's not clear how the deal impacts on the service club if at all, other than who its landlord will be.

It's believed the tentative deal to be presented tonight is fully supported by members of council's appointed "working group" which consists of the mayor, deputy mayor Rick Milne, and Ward 3 councillor Paul Whiteside, as well as the GCC Board, whose president is Christine Brayford, and the Gibson Centre Mortgage Holders (members of the Gibson family).

The working group's mandate was to be "based on a principle that ensures no ongoing substantial additional funding requirements from the Town." Back in March, the mayor said the key term was "substantial."

The GCC Corp has owned the property officially since July 1, 2001 when Bing and Leonard Gibson turned over the dilapitated building which dates back to 1889 to the then newly formed non-profit board for $1. New Tecumseth contributed more than $1.3 million for its renovations since then, and continues to provide an annual grant of $25,000.

In April 2001, as a condition to receiving a $1 million grant from the Town the GCC Corp agreed to  "not sell, mortgage, or encumber the real estate property they own without the approval of the Town for a period of 10 years."

In January 2008, council voted to relieve the GCC of that condition, which then went out and took out its first mortgage. A cursory audit of the finances determined the organization required at least $220,000 annually to service the debt and operating shortfalls. When it was in jeopardy of folding in 2010, members of the Gibson family agreed to buy-back the bank note, provided an interest-free and payment free holiday which was to provide the GCC time to build up a business plan.

GCC is a licensed establishment which hosts special permit events including weddings, parties with seating for about 150 people. It has a kitchen and bar, and a venue for live events that can seat 160 and standing room for 220 people.

But even with the additional time, the GCC could not come up with the revenue sources and streams required to meet its obligations. The Gibsons' note came due last December, but agreed to a further one year extension that expires in December.

The deal to be presented tonight is to meet the December timeline.

At this writing, mayor MacEachern had not responded to emails seeking comments specifically around the issue of why this matter was being dealt with in camera. More details as they become available and confirmed.

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