Small business loans not repaid to Toledo

Mar 12, 2015 - Toledo Blade - $2.4M in loans by city were never repaid

From the Blade story:

A loan program for Toledo businesses the current administration wants to expand and revamp, handed out nearly $2.4 million of taxpayer money over 25 years that never was collected. Companies went out of business, filed bankruptcy, or simply stopped paying.

A review of city records revealed 41 loans — many from the 1990s, and one stretching back to 1990 — were deemed “uncollectable” or “bankruptcy discharged loans.”

Toledo Economic Development Director Matt Sapara, who asked Toledo City Council to double the maximum loan amount to $200,000 for the city’s “enterprise development loan” program, acknowledged some loans should not have been issued.

The requested changes to the program were announced in January, before Mayor Collins died. Mayor Hicks-Hudson has adopted her predecessor’s request.

The loan money comes from the federal government’s Community Development Block Grant program allocated by the U.S. Department of Housing and Urban Development. The city has used a portion of its annual allocation for the loan program, which was created as a way to create jobs and help small businesses.

Toledo Warehouse District Association

Although the loan limit is supposed to be $100,000, several loans exceeded that amount. The city granted a $250,000 loan carrying a 4 percent interest rate to the Toledo Warehouse District Association in January, 2003, during the administration of former Mayor Jack Ford.

“Loan sent to law department for collection,” according to a document listing outstanding loans prepared in 2013 by the administration of former Mayor Mike Bell. “Settlement was reached. Loan is uncollected.”

Settlement? According to info below, the Warehouse District Association repaid $0.