By Chris Jensen
DIXVILLE — Helped by funding from Northern Pass, the Balsams Resort has moved significantly closer to a crucial funding step needed to bring the resort back to life and boost the economy of the North Country, the company said Wednesday.
Chris Jensen photo
The Balsams closed late in 2011 and the following year most of its furnishings were sold at auction. Chris Jensen photo
That step is going before the Business Finance Authority to ask that the state guarantee a $28 million loan to developer Les Otten.
Almost two years ago, then-Gov. Maggie Hassan, now a U.S. senator, signed a bill making it possible for the BFA to make such a loan.
If Otten defaults on that $28 million loan, the state’s collateral would be at least a portion of the Balsams.
But before such a guarantee is possible, the BFA has to consider information ranging from the financial risk to the benefits, including boosting the employment in the North Country.
All the information necessary for the BFA to consider backing the loan is now available, said Scott Tranchemontagne, a spokesman for the developers.
He said the final piece is a 27-page report addressing the employment issue. It was just finished by Polecon Research of Dover, N.H. Among its conclusions:
* An average hourly wage of about $17 will allow the Balsams to attract the workers it needs, despite a somewhat tight labor market.
* About 400 employees will be needed when the resort opens and if the resort expands that could increase to 1,500. That will provide a large boost to the local economy.
* About 600 construction jobs will be created for the first phase.
Another key piece of information needed by the BFA is also done, said Tranchemontagne. It is a financial analysis of the value of the land and Otten’s operating budget.
It was commissioned by Northern Bank & Trust Company of Woburn, Mass. The bank is considering loaning Otten about $100 million, including the $28 million.
Tranchemontagne said it is up to the bank to submit the application to the BFA and he is not sure when that might happen.
“We’d like to move it as quickly as possible, but it is a little bit out of our hands now,” he said.
The first phase of the project is expected to cost $143 million and Otten has said it is crucial that the state back the $28 million loan.
Paying for the Polecon report and moving the project ahead was possible thanks to a $3 million loan from Northern Pass’ Forward NH Plan, Tranchemontagne said.
In filings with the state’s Site Evaluation Committee, Otten has praised Northern Pass and said it will be good for the Balsams and the state. Later this year that committee is expected to decide whether to allow the controversial project to go ahead.