Lorain Council to weigh LCCAA mortgage
Stephen Szucs | The Chronicle-Telegram
LORAIN — City officials want to help keep Lorain County Community Action Agency downtown, even if it means becoming the agency’s landlord.
City Council will consider on Monday whether to purchase two mortgage loans, one of which has matured, for $450,000 on the agency’s behalf in order to safeguard its 48 employees and annual $45,000 in city income taxes.
Although the total principal and accrued interest balance of the loans is $850,000, Lorain Community Development Director Sandy Prudoff said the city was able to negotiate the purchase down to $450,000, enabling the agency to save $3,500 a month in payments and avoid risking foreclosure over a balloon payment.
Prudoff said there was no way of knowing when or if the mortgage company would’ve pulled the trigger on the payment, but it wasn’t worth chancing.
“Whether they would’ve or not, you don’t want to play Russian roulette with people’s jobs or our businesses,” he said.
If Council approves the ordinance, the city will purchase the loans using its business revolving loan fund.
In addition to keeping the agency in the city limits, the city would receive the transferred titles of agency properties at 502 and 506 Broadway.
The agency would be expected to begin paying monthly payments of $2,500 over a 20-year term at a rate of 4.25 percent. The monthly repayment is guaranteed through the agency’s funding from federal, state and other program revenues, according to the ordinance.
The Lorain County Community Action Agency is a nonprofit entity that works to improve the social well-being, economic capacity and opportunities for low- to moderate-income families through numerous programs.
Prudoff said the agency, which also currently leases the city’s Head Start building, hasn’t missed or made a late payment in 14 years and is a dependable organization to work with.
“(The agency’s executive Director Bill Locke) has put the agency back on the gold standard,” Prudoff said. “I’m really pleased to be able to work with the agency.”
Locke couldn’t be reached for comment.
Contact Stephen Szucs at 329-7129 or sszucs@chroniclet.com.
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Filed by Stephen Szucs | The Chronicle-Telegram October 3rd, 2008 in Local and State. Popularity: 1% |
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