Poplar Bluff City Council members voted 5-2 Monday to make changes to a loan with First Midwest Bank for the purchase of 58 acres of property on Shelby Road, which are to be used for a new police department.
An ordinance approved Feb. 18 by the council would have entered a lease purchase agreement with First Midwest Bank to finance a short term loan for approximately $1 million, city manager Mark Massingham said.
Both First Midwest Bank and the bank which owns the property, First Missouri State Bank, asked that the city amend the ordinance to so that the lease purchase was not part of the agreement.
The terms of the loan will remain the same regarding interest rate and fees, Massingham said.
First Midwest would have retained the title of the property until the loan was repaid, under a lease purchase, Massingham said. This would have caused issues for both banks, he said.
First Missouri State Bank has said it will donate the remainder of an estimated property value in excess of $4 million to the city, in exchange for the $1 million purchase price.
Council members Robert Smith and Ed DeGaris voted against the change, and previously voted against the original loan agreement in February. They have spoken against the Shelby Road site for the police department.
The loan will carry a 3.650% interest rate, as approved by the council in February.