FLAG remains behind on loan payments to county

The Webster Progress-Times

WALTHALL - Front Line Apparel Group remains behind on its repayment of an economic development loan, according to Webster County officials.

The county, through a Mississippi Development Authority grant, made the loan to the company in December 2006. The military clothing company made its monthly loan payments on schedule until last September, with the county in turn forwarding the same amount to the MDA.

General partners Ron Levine and Victor Winogradow of Connecticut later told the Board of Supervisors they were having cash flow problems after an interruption in production at the Mathiston plant resulting from fabric delivery problems

The county board, after negotiations with them, adopted a revised loan repayment proposal last month with FLAG, and Levine and Winogradow individually, as borrowers. Its terms called for the company to pay the county $4,500 on the first day of each month from May through August, plus an additional $13,000 during May, plus an additional $8,500 monthly in June and July. The agreement stated that the indebtedness and any other owed by FLAG would be renegotiated in August if these payments were made as outlined.

Board attorney Buchanan Meek Jr. told supervisors Monday that Front Line had sent the county only one payment since then - for $4,500. Additionally, he said the company had stopped payment on ad valorem tax checks.

"At this point they're just lying about everything," Meek said.

Board President Robert Hitt said, " I don't see anything to do but lock them (up)."

Meek said the county had the authority to seize equipment in the plant used as collateral for the loan and sell it, noting that the board had to show MDA it was doing all it could in good faith to collect the money owed.

"I don't know anything to do but get the collateral," he added. "I'm convinced at this point that they don't intend to pay it."

Meek agreed to contact building owner Larry Knotts of Amory, who is leasing the building to Front Line, to see if he would lock the building. He said, however, that the county might have to file a replevin, which is an action or a writ issued to recover an item of personal property; or make a bond to take possession of the equipment immediately.

Members of the board agreed to go the plant that afternoon with serial numbers in hand to inventory the equipment used as loan collateral. However, no one was there when the supervisors arrived, Chancery Clerk Russ Turner said Tuesday.

Ruthie Salley (District 2), an employee of Front Line, recused herself from the boardroom during the discussion.

Bridge Bids

Also Monday, the board accepted low bids from Ellis Construction of Columbus for two State Aid bridge projects. One bid was for a Local System Bridge Project on Savannah Lake Road in District 5, which was $191,739.88. The other was for a Surface Transportation Program bridge project on South Sapa Road in District 4, which was $412,330.20.

One of Ellis' bids came in 26 percent under the state estimate and the other 10 percent under estimate, according to the State Aid engineers who recommended that they be accepted.

Housing special Patsy Patterson with the Golden Triangle Planning and Development District conducted an initial public hearing regarding HOME housing improvement grant funds. A number of potential applicants attended.

Supervisors went into executive session to discuss with Meek a federal lawsuit filed against the county by Latisha S. Pittman. As reported in February, Pittman alleges the Sheriff's Department falsely arrested her last year on drug charges. She was jailed in April 2008 on a charge of selling drugs but was released two days later after being advised that all charges were being dismissed. The board took no related action after coming back into open session.

Executive Director Cynthia Wilson of the Webster County Development Council updated supervisors about various projects in the works resulting from the Eupora Charrette and reminded them of a WCDC meeting set for 7 p.m. Monday at the Depot.

The board recessed until 8:30 a.m. June 30.