NPAC Corp. - The Arts Center Private Shell Corporation Under The Control Of The City Of Nashua

I currently have a Supreme Court appeal (2024-0181) regarding a Right to Know petition to obtain public records from NPAC Corp. The Petition was dismissed as a Nashua Judge ruled that NPAC Corp. did not meet the requirements of a public body or public agency required to disclose records. However, NPAC Corp is the shell corporation spun out of a federal program creating a public private partnership to obtain federal money to assist in building our Art Center. The City never disclosed that it was in a public private partnership. NPAC Corp. is defined by signed contracts and City legislation as a “controlled affiliate” of the City of Nashua. It has many characteristics of a public corporation.

The City has been dribbling out art center records for three years which is uncovering evidence of NPAC Corps. public structure. Even though taxpayers bought the site to construct the center and paid the construction costs through bonds, in order to make this federal deal work, taxpayers have to pay rent, 1/2 million a year, to be the Master Tenant of the building. NPAC Corp may cut distributions back to the City through the nonprofit public corporation controlled by the City, 201 Main St. Real Estate Corp. The exact amount of money was never defined by contract. However, there is a document that was signed at the closing for this Art Center deal that addresses distributions to be paid back to the city with bank covenants in place to ensure those distributions can be cut.

In 2023, CFO Griffin had told the Budget Review Committee that yearly distributions were being made from NPAC Corp to the City. Based on the opening date of the Art Center, there should have been a distribution paid back in June of 2023 and 2024.

At the June 17, 2024 public meeting, a citizen asked about this distribution and rental payment being made to NPAC Corp. The Mayor responded that it is a net zero transaction as NPAC Corp was essentially returning all the money back to the city by way of a distribution. The Mayor's statements were inaccurate and were made in the presence of CFO Griffin who also knew those statements were inaccurate. The distribution to be paid back would not be a net zero. But more importantly upon investigating the accounts receivable and expenditure reports of the city, no distributions have been made back to the city in two years. The CFO knew this as well.

The reason for this only recently became known through a series of Right To Know requests that have been anything but forthright. It turns out according to CFO Griffin, announced at the June 4, 2024 Budget Review Committee meeting,, the City is conducting an audit of NPAC Corp.'s books to determine if the bank covenants can be met to cut a distribution back to the city. The audit has not yet been completed.

Mascoma bank, lender for the Federal money, alerted NPAC Corp, that distributions could not be given until NPAC satisfied the covenants of the Loan Agreement. According to the QLICI Loan Agreement, distributions are permitted by NPAC if the DSCR (Debt Service Coverage Ratio) is 1:1 or better. Evidence of the DSCR calculation, using the NPAC audited financial statements, will provide the Bank with confirmation of meeting the requirement permitting NPAC Corp. to cut distributions to the City. Apparently, NPAC Corp. never did the audit so the money was not coming back. The reason for this requires another article.

It's hard to understand how the City can claim that it has no control over this private corporation when it has the ability to audit its books. Taxpayers are paying NPAC Corps. legal fees. Are we paying for this audit?

Why do citizens have to work so hard to understand where our money is going and how it is being spent? Why are so many dishonest and inaccurate statements being made by the Mayor and City leaders regarding our money in these shell corporations? A lack of transparency is a symptom of dishonesty.