This is from last year but is newsworthy again today. Before we explain, lets review:
- The first spreadsheet details the entire amount of CDBG funds (4,136,520) and who was awarded what amount last year.
- The second list details a portion of the entire amount (616,728), that was available for “public services”. The City had 26 applicants asking for $1,123,049 under “public services”. In the end, the 16 applicants listed at the top were awarded on average of 87.83% of what they requested.
The 10 applicants on the bottom received nothing. The 16 applicants that were received money on the 2nd list under “public services” are all listed on the first list, since they received monies. The number that jumps out to me is the 3rd number on the first list of 362,798 for the HUD loan with the title Kilby-Gardner-Hammond debt service.
Why is the City of Worcester using their CDBG (Community Development Block Grant) monies to pay back a loan for Kilby-Gardner-Hammond? Bottom line is that these HUD guaranteed loans are very serious and no different if you were the co-signor on a car loan. The City was the co-signor on this HUD loan and when Kilby-Gardner-Hammond did not make the payments, the City of Worcester was stuck with the bill.
It gets worse since we have two balloon payments on this HUD Loan (2018-1,870,000 and 2024-1,270,000), which we will have virtually no money left for “public services”. Why are we rehashing this today?
#Worcester‘s urgent task: Spend $1.83 million in grant money or lose it http://t.co/9ca2rVClZg @NCKotsopoulos
— Mike Elfland (@MikeElfland) April 13, 2015
In this column by Nick K, he details how the City of Worcester “has to spend $1.83 million in unexpended federal grant money by May 2 or lose it”. Will this go back to fund projects like the successful NRSA programs or maybe some of the applicants who failed to get awards last year? No, the whole amount will go to pay off this Gardner-Kilby-Hammond loan. One would think at the very least any agency associated with this loan would be ineligible for future NRSA grants, think again.