Instead of outright foreclosure proceedings on the Roanoke Rapids Theatre, city council Tuesday opted to go with receiving the deed of trust in lieu of foreclosure, which will revert the venue back to the city.

It is a process City Attorney Geoffrey Davis said he and the attorney for G&T Holdings have been discussing over the past couple of weeks.

“If we follow through on that and the council agrees to accept, ultimately the property comes back into possession of the city of Roanoke Rapids for the first time since 2015/16 and then it’s up to the city council as far as what they want to do with that,” Davis said. “If the council agreed to accept the deed in lieu of foreclosure tonight I believe that we can have it signed and have the property back under our control by the end of the week.”

Once the venue is back in the city’s hands, Davis said city council could put it back on the market as early as its August meeting.

With Councilwoman Suetta Scarbrough absent, the panel unanimously agreed to go with that option — one of three Davis presented.

Davis explained the way G&T is set up, the only asset it has is the theater. “If we were to go through foreclosure proceedings our best day is we either get the theater back or we get whatever somebody’s willing to pay for it in an auction. I don’t think those are very good scenarios. It’s not like there is money still owed that we’re going to be able to go back to G&T and seize some other kinds of assets or file some kind of lawsuit against them to get it. They don’t have any of the assets.”

A title search came back perfectly clean. The city continues to hold the promissory note on the venue.

Another item that will have to be addressed is a security agreement for the personal property inside the venue. Davis explained that consisted of items such as the lightboard and furniture which was sold to G&T as part of the original deal. “To get that personal property back to us they’re going to have to do a bill of sale.”

The city will not have to pay G&T any money to get that property back.

The action taken at the meeting comes as G&T, which is made up of Thomas and Evon McLean, is in default on their balloon payment to the city. “The original agreement we had with G&T is they made monthly payments and then at some point two or three years ago they were supposed to make a balloon payment to pay off everything that was owed on the theater and the interest.”

The company wasn’t able to make that payment. “They came back to us. There were several extensions that were worked out under different terms to try to move that balloon payment to the future because they were having difficulties being able to come up with it at the time,” Davis said. “Now, we’re kind of at a point where it does not look like that that is going to be a possibility. They’re in default. They really haven’t discussed anything as far as extension and I think the time has kind of passed for that.”

Following that action, City Manager Kelly Traynham presented a budget amendment associated with the theater in which the city will take over operating expenses which will keep the lights, heating and air, over the next three months.

The council opted to go with Traynham’s recommendation of three months at a total of $51,420. 

The breakdown of those expenses are:

$600 to Centurylink for phone lines

$720 to Centurylink for internet and fiber

$390 to Charter Elevator 

$500 to Johnson Controls for annual fire monitoring

$30,000 to Roanoke Electric for power

A total of $360 to the Roanoke Rapids Sanitary District

$300 to the Security Connection for annual security alarm service

$1,000 to Threatt Plumbing for the annual fire pump inspection

$150 to ASCAP/BMI for music and performance licensing

$15,000 for building maintenance which performed by the city’s Public Works Department

A one-time replacement cost of $2,400 to Draughon Brothers to replace the defective audio processor