Smithfield VA Events sublease proposed

Published 12:06 pm Wednesday, July 5, 2017

Non-profit would pay town $27,000 a year for facilities

By Ryan Kushner

Staff writer

In a recently proposed 15-year sublease, Smithfield VA Events would pay $27,000 annually in rent for buildings at Windsor Castle, which the organization would then use as its office and storage space.

The town of Smithfield would still maintain ownership of the proposed buildings, two of which are not yet constructed.

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The Town Council still needs to vote on whether to approve the sublease. {mprestriction ids=”1,2,3,4,5,6″}

SVAE President Randy Pack, who is also a member of the Town Council, proposed the partnership in April and requested that the town take out a loan of up to $450,000 to build two new storage barns and renovate the interior of the early 20th century caretaker’s house, projects which have not yet been funded in the town’s restoration project.

SVAE, a nonprofit known for large triannual festivals held at Windsor Castle Park, would then pay the town rent in the form of $2,250 per month to pay back the town’s debt service from the loan.

The Town Council would need to authorize the loan separately from the sublease agreement consideration, according to Town Manager Peter Stephenson.

During the life of the sublease, the monthly debt service payments from the nonprofit would add up to a total of $405,000.

“You’re just borrowing money to fix up your own property,” said Town Attorney Bill Riddick to the Town Council while presenting the sublease Tuesday. “It’s not coming out of tax revenues, there’s a stream of independent income [from SVAE].”

The 40-acre Windsor Castle property, once owned by Smithfield founder Arthur Smith IV in the 1750s, is currently being leased from the town by Historic Windsor Castle Restoration, an LLC formed to manage the multi-million-dollar restoration of the historic buildings on the town property.

According to the LLC’s five-year lease with the town, which was approved in January, the LLC requires approval from the Town Council to enter into any sublease agreements.

According to the sublease proposed, SVAE would make its monthly payments to the LLC, which is set to dissolve after the restoration work is completed.

The sublease was presented at a Public Buildings and Welfare committee meeting Tuesday, June 27.

During the meeting, Council member Denise Tynes asked whether the town would be “stuck” paying for the two new barns and interior renovations of the caretaker’s house should SVAE dissolve before the end of the 15-year sublease.

Riddick said that is a possibility.

“If it should happen…that means the public will be left taking care of those renovations,” Tynes said of the two new barns and interior of the caretaker’s house.

Riddick responded that the town has an obligation to complete the projects, regardless of SVAE’s involvement. SVAE’s offer just means that the town has additional funds that can move the project up sooner.

The Virginia Department of Historic Resources (DHR) approved the addition of two new barns on the historic property. They are designed to be replicas of barns that previously existed on the farm. In the town’s plans, the new barns were originally listed in the final phase of the restoration project.

DHR has said it is not mandating the construction of the barns as part of the project.

“That’s strictly the town’s desire and the easement agreement allowed for that eventuality,” said DHR spokesman Randall Jones in an email regarding the two proposed barns.

As for the caretaker’s house, Jones said that “at the very least” DHR would require that repairs be made to the outside to stabilize the interior and prevent further deterioration to both exterior and interior.

Riddick added during the meeting that SVAE has a good track record and has been around a while and has had a history of success.

The group first formed in 2010.

The town could also lease the property to another organization should SVAE cease to exist, Riddick said.

This past spring, Historic Windsor Castle Restoration made an effort to open itself up to proposals from any other organizations interested in offering what SVAE was offering by speaking with regional news organizations about the opportunity.

No other entities submitted proposals, however, and the LLC requested that the Town Council consider SVAE for the sublease.

SVAE, which is run by several other town and county officials along with Pack, has been using the Windsor Castle manor house as a storage space for its event supplies.

Since its inception, the organization has donated more than $500,000 to local nonprofits and charities, and gives $5 of every ticket sold for its events to the town.

The Historic Windsor Castle Restoration LLC was formed so that the restoration project would be eligible for historic tax credits from the state, which the town would not have been eligible for if it had managed the project itself.

The LLC is made up of representatives from the town, Windsor Castle Park Foundation and Smithfield Foods.

Smithfield Foods donated $1 million for the restoration, and the town is putting in $2 million.

The entire restoration is estimated to cost $5 million.  {/mprestriction}