Vernon, Mtn. Creek close to debt deal
Vernon. Township Council, MUA will meet on Thursday to possibly approve revised settlement with Mountain Creek to resolve the resort's $28 million in sewer debt. The Board of Chosen Freeholders will meet Wednesday.
| 13 Aug 2019 | 03:57
By Mike Zummo
The Vernon Township Council and the Vernon Township Municipal Utilities Authority will meet Thursday to discuss a proposed settlement agreement with Mountain Creek to settle the $28 million dollar debt.
According to a document filed by Mountain Creek attorneys, the revised settlement will make payments of $600,000 in 2020, 2021, 2022 and 2023 and $300,000 in 2024 and through the time where the sewer debts are paid in full.
The minimum payment shall be secured by the Vernon Letter of Credit and a lien on the land from 2024 until the debt is satisfied.
If the payments are not met, Vernon can put a lien on the land with written notice of at least 5 business days.
The resort and township had an agreement in late December, but the Sussex County Board of Chosen Freeholders objected to the settlement on the basis that Vernon Township had no mechanism to put a lien on the resort’s property.
The Freeholders are scheduled to meet Wednesday night to discuss the settlement.
The previous settlement featured an immediate payment of $918,000 from Mountain Creek. It was to create a revenue stream from Mountain Creek through ticket sales to pay obligations, a $200,000 cash collateral trust fun to be replenished for any amount that is withdrawn. Pump House 2 was to replaced by the township but Mountain Creek was to repay the township.
Mountain Creek filed for bankruptcy in May of 2017, and in July sought to relieve itself of $28 million owed specifically to the VTMUA.