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1 <br /> ORANGE COUNTY <br /> BOARD OF COMMISSIONERS <br /> ACTION AGENDA ITEM ABSTRACT <br /> Meeting Date: February 4, 2014 <br /> Action Agenda <br /> Item No. 6-k <br /> SUBJECT: Authorization of a Deed of Trust by Orange Enterprises, Inc. <br /> DEPARTMENT: Attorney PUBLIC HEARING: (Y/N) No <br /> ATTACHMENT(S): INFORMATION CONTACT: <br /> January 24, 2014 Orange Enterprises John Roberts, (919) 245-2318 <br /> Letter <br /> Resolution Authorizing Orange <br /> Enterprises to Subject the Property on <br /> Elizabeth Brady Road to a $250,000 <br /> Deed of Trust In Excess of the Current <br /> $715,000 Limit <br /> PURPOSE: To authorize Orange Enterprises, Inc. (OE) to obtain a deed of trust in an amount <br /> of$250,000. <br /> BACKGROUND: OE is an Orange County Nonprofit Corporation organized for the purposes of <br /> providing "creative opportunities for handicapped persons and/or persons with other <br /> employment barriers." In 2005 Orange County and OE entered into an Agreement (the <br /> "Agreement") whereby Orange County would contribute funding towards OE's purchase and <br /> upfit of a property and building located at 348 Elizabeth Brady Road (PIN 9874-550-774) for the <br /> purposes of OE's expansion of operations. <br /> The terms of the Agreement limit OE's ability to encumber the property with any deed of trust in <br /> excess of Seven Hundred Fifteen Thousand Dollars ($715,000) without the express written <br /> authorization of the County. OE currently has a deed of trust encumbering the property in an <br /> amount of Six Hundred Eighty Thousand Three Hundred Sixty-Two Dollars ($680,362). The <br /> current assessed value of the property is One Million Ninety-One Thousand Five Hundred <br /> Nineteen Dollars ($1,091,519). <br /> The terms of the Agreement also provide that in the event of OE's default, the property shall <br /> revert to Orange County. Should such a reversion occur, Orange County would be responsible <br /> for any outstanding deeds of trust on the property. The limitation protects Orange County by <br /> limiting the amount Orange County would have to pay in such a circumstance. <br /> OE has requested the County authorize an additional deed of trust in an amount of Two <br /> Hundred Fifty Thousand Dollars ($250,000). In support of this request OE states the following: <br /> "OE is in good financial health. The line of credit is necessary to meet cash flow <br /> requirements of its operations, not as a stopgap measure to meet long-term obligations. <br /> For instance, several of OE's customers are government entities with payment schedules <br /> much longer than traditional net-thirty terms. Since these receivables do not turn over as <br />