Ozark Natural Foods will move forward with plans to pay off the remaining $1.5 million mortgage on the cooperative’s building, located at 1554 N. College Ave. in Fayetteville.
Board president Joshua Youngblood announced the decision Wednesday during a press conference held outside the co-op. Youngblood said the plan is to make the final payment on Dec. 10.
The loan payoff has been debated among co-op members since the board began discussing the issue in June 2011. Some members are concerned about an estimated $300,000 to $495,000 in early payoff penalties that will be incurred.
Youngblood, however, maintained that the penalties would be more than offset. “By paying off the loan now, the co-op will save at least $400,000 in interest payments,” he said.
Payoff of the debt would also enhance the co-op’s ability to secure loans in the future, Youngblood said.
Not all of the 9,800 of the co-op’s owners agree with the decision. About 150 members signed a petition asking the board to seek the advice of a third-party professional debt and asset management company before moving forward with the payoff.
Youngblood said the board will address the petition at a closed session on Friday, Dec. 7, but maintained that the board has reviewed the payoff issue with several owners “with financial backgrounds,” and is confident that the payoff is the right direction.
“We know that some owners have concerns about the co-op,” he said. “Better control of expenses, including paying of the loan early and eliminating monthly payments, and the cost-saving measures already implemented in preparation for the payoff will allow us to look for more ways to pass savings on to the owners and customers of Ozark Natural Foods.”