ROANOKE RAPIDS — Two public hearings will give Valley residents a chance to voice their thoughts and concerns about the future of The Roanoke Rapids Theatre Tuesday.

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The City Council will hold the hearings to review a proposal by Northampton County native and Chicago businessman Lafayette Gatling to purchase the entertainment venue.

Gatling’s proposal — a lease purchase agreement — sets the price of the theater at $12.5 million. He could receive a $1 million discount if all the payments are made in a timely manner under the proposed agreement.

The lease-purchase offer only covers the theater’s purchase. It does not involve the more than $7 million in bond funding that went to provide seed money for the theater, interest payments and infrastructure costs to the city.

The city would still make payments to Bank of America to retire the entire bond package with money from the treasury making up the difference between the payment of the theater and the total bond — approximately $830,600 annually (fiscal year). Without the Gatling payment, the city would owe $1,928,353.

The 10 a.m. public hearing will be held in the first floor conference room of city hall located at 1040 Roanoke Ave. The 7 p.m. hearing coincides with Council’s regular meeting and will be held in the Lloyd Andrews City Meeting Hall on Jackson Street.

Gatling’s was one of 21 offers the city had to purchase or manage the theater. Built as part of a $21.5 million bond package, the theater has been closed since May. The original manager and theater namesake, Randy Parton, was booted from his job in December. An independent management company was hired but dismissed in a dispute over a $40,000 bonus for its manager. The city then ran the theater for several months before deciding to close it down as a cost savings move.

Gatling entered the picture in early summer, according to city officials. His proposal was endorsed by the city’s Theater Advisory Committee. The Council is now carefully examining his plan.

The finances

Terms of the contract set $12.5 million as the purchase price with the understanding that if payments are made on time the price will be reduced by $200,000 each year at the end of the 21st, 33rd, 45th, 57th and 69th months, thus giving Gatling a $1 million credit applied to the price at purchase. In order to do this he must complete the deal and buy the theater.

According to the payment schedule, $250,000 should be paid upon signing. In the second through fourth months, interest payments of $59,718.72 are to be paid.

North Carolina statutes require a 5 percent bid deposit which can be in the form of cash or a bond in the amount of $625,000, City Manager Phyllis Lee said this morning. The city would have to receive that before Council takes any action to accept the proposal.

Once that takes place, City Council would adopt a resolution notifying the public of the offer and their intent to accept it, Lee said. The resolution provides a 10-day period in which anyone can raise that bid but not less than 10 percent of the first $1,000 and 5 percent of the remainder. To upset that bid someone would have to bid $13,125,050, she said.

In months five and six, principal and interest payments of $250,000 are to be paid while in months seven through nine, interest only payments of $57,858.99 are to be paid.

In months 10 through 171, payments of $98,203.49 are to be paid while in month 172, a payment of $97,620.22 is to be paid.