Coucillors in Kerry yesterday voted to support a scheme proposed by the Jeanie Johnston company which will make the county council along with Tralee Town Council one-third owners of the replica Famine ship together with Kerry Group plc, and Shannon Free Development Company.
Under the scheme non-local authority unsecured creditors will get 60 per cent, while the local authorities will get deferred shares. A new board and a new chief executive will be appointed.
A creditors' meetings takes place in Tralee next Friday by order of the High Court to consider the proposals. The arrangement if accepted by all will save the famine ship company from liquidation.
Kerry County Council voted also to borrow €1.14 million to offset its share of a €2.6 million Bank of Ireland loan to the company which the council and Tralee Town council guaranteed.The total amount owed by the Jeanie Johnston company to both local authorities and to be converted to deferred shares is €3,822,409. During the lengthy council meeting the "deferred shares" were described as useless, as there would never be a dividend from them. The Mayor of Kerry, Mr Michael Healy-Rae was among four councillors to vote against the proposals. "We are raising a loan to get ourselves one-third ownership in a boat and we can't finish a sewage scheme in Farranfore, villages can't get proper water supplies," Mr Brendan Cronin said.
"There are no ifs, buts, and howsoevers," about the repayments for the guaranteed loan, and the council had to meet its obligations. It guaranteed the loan and the company had defaulted on repayments, Mr John O'Connor, director of finance with the council said. But "this is the end of the road," with regard to the council's financial involvement, Mr O'Connor warned.
Cuts will have to be found in services across the board to pay for the loan, which will cost the council €120,000 per year and which with interest will amount to up to €2 million over the next fifteen years. The Kerry local authorities along with the Department of Communications, Marine and Natural Resources have jointly commissioned a review of the €13.6 million Jeanie Johnston project.