SUN has long demonstrated against the city’s use of HUD Section 108 loans to fund economic development projects. In 1992, we held a public protest about the Center Armory project. In 1999, we forced the Common Council to hold a finance committee hearing on the purchase of the Addis/Dey’s building. In March, we were instrumental in more hearings on $2.5 million in failed loans for a toe-cap factory off Erie Boulevard.
The collateral for the HUD Section 108 loans is the city’s annual Community Development Block Grant budget. $4.2 million that could have gone to help families repair their homes has been wasted on bad economic development deals. This year, we will lose an additional $2 million.
The city is very sanctimonious when they claim they want to run the city like a business. In a business, when you borrow money, you have to pay it back. Why isn’t the city discussing the way to replace the $6.2 million they have borrowed from poor families over the last decade? Instead, the city administration is talking about making new loans under this program.