Belle Fourche tables potential country club property collateral pledge
BELLE FOURCHE –– The Belle Fourche City Council Monday, acting on advice from City Attorney Dwight Gubbrud, unanimously agreed to table the issue of whether to pledge two city-owned lots as collateral for a loan to finance improvements at the Belle Fourche Country Club.
Monday’s discussion was based on the legal finance committee’s recommendation to approve the country club’s request for the city to pledge Lots G and 8, which the club resides upon, as collateral for a 20-year loan with a debt cap of $160,000.
The country club land is owned by the city, and the business and buildings are owned and operated by a board of directors, which manages and runs the bar and clubhouse.
Because the club does not own the land, it cannot get a mortgage on the property to fund the improvements, which is why it opted to proceed with the request.
The discussion, which began at the legal finance committee level, has been ongoing in recent weeks. The last time the topic came before the city council during its Oct. 15 meeting, the club requested that the city convey the property to them. Conveyance is the legal process of transferring property from one owner to another. The club could then procure a loan without asking the city to give collateral.
The council requested more specific financial documentation and scope of work to be completed, and sent the concept back to committee for ironing out.
Specific details about the upgrades were not discussed at the meetings.
Clay Birkeland, who served on the country club’s board until November, spoke to the legal finance committee during its Oct. 29 meeting, and explained the updates the club is hoping to finance. Birkeland said that in 1967, the city cosigned a loan for the country club.
“The city has no responsibility to pay that loan, but they pledged the collateral that they own, the land, in case we (the country club) don’t make the payments, then whoever has the loan can foreclose on the property,” he said.
That loan was paid off in 2016.
The city, if it chose to pledge the property as collateral, would not be responsible for the mortgage.
Gubbrud, who said he’d been in touch with the country club board’s president, advised the council Monday not to move forward with the approval, instead requesting the council to table the topic indefinitely.
“There’s questions on whether we (the city) even need to mortgage this, and the country club is going to look at a different avenue at this time,” he said.
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