Providence Loan Program Under Fire - A Complete Timeline
Monday, October 22, 2012
The Providence Economic Development Partnership (PEDP) is under fire after more than a dozen GoLocalProv stories uncovered millions of dollars in delinquent loans, unauthorized agency spending and questionable deals.
Below is a complete timeline of all PEDP stories dating back to October 2011 when we first reported that more than a quarter of the taxpayer-funded loans issued through the program were at least 90 days past due.
10/24/2011 - Providence Stiffed for Millions in Loan Money
The Providence Economic Development Partnership (PEDP), an initiative that includes 16 small business owners or politicians and is chaired by Mayor Angel Taveras, is currently stuck with a tab of $3,358,637.67 in delinquent loans, according to Joshua Teverow, the lawyer who represents the PEDP.
The South Providence recycling company that is more than 90 days past-due on a $410,000 loan from the Providence Economic Development Partnership (PEDP) also received a $300,000 loan from the Rhode Island Economic Development Corporation’s Small Business Loan Fund, records show.
The Bank of America Skating Center has come to be a landmark in downtown Providence, but a former Chairman of the Review Commission is saying taxpayers were misled about the cost of the rink by the Buddy Cianci administration and then left on the hook when the city converted a Providence Economic Development Partnership (PEDP) loan into a grant.
Following two GoLocalProv reports this week about the number of past-due Providence Economic Development Partnership (PEDP) loans and the decision to convert a loan for the Bank of America Skating Center to a grant, City Councilman David Salvatore is calling for greater City Council oversight of the PEDP loan program.
12/8/2011 - Full Review of Providence Loan Program Coming
The government agency that oversees the funds awarded to the Providence loan program that has come under scrutiny in recent months says it will begin a comprehensive review of the program at the beginning of the year.
The South Side bar that was recently dealt an 11 day suspension of its liquor license after a 19-year-old male was shot in the establishment’s parking lot is also more than 2,000 days late on a taxpayer-funded loan from the city of Providence, GoLocalProv has learned.
The Providence Economic Development Partnership (PEDP) last week voted to write off 29 taxpayer-backed loans for small businesses, leaving the capital city on the hook for $2,171,125.66, GoLocalProv has learned.
All but seven of those loans were more than 1,000 days past due and one –a $60,660 loan for Danal, Inc. issued in 1996— was 4,799 days late as of last week.
The report, issued by the U.S. Department of Housing and Urban Development (HUD), analyzed ten years of the Providence Economic Development Partnership’s (PEDP) finances and found that the program had little oversight over funding recipients, failed to meet requirements for financial management standards and displayed questionable use of federal funds.
The agency that oversees Providence’s small business loan fund spent nearly $25,000 of federal funds on lunches for board members between 2006 and 2011, according to a list of expenses provided to GoLocalProv.
Council members were informed prior to that May meeting, the agency was not required to provide loan default records or other information related to loans being doled out on the city’s behalf. The PEDP was a separate body, Councilors were told, with its own board that counted the Mayor as its chairman.
A prominent Democratic social club in Providence’s Silver Lake neighborhood was a recipient of a taxpayer-funded loan through the Providence Economic Development Partnership (PEDP), GoLocalProv has learned.
The taxpayer-funded loan program run by the city of Providence still had 18 loan recipients that were at least 500 days behind on their payments as of the end of July, according to an aging report obtained by GoLocalProv.
Collectively, the 18 recipients owe the city $1,083,563.18.
The man seen in an undercover video telling a campaign staffer for Congressional candidate Anthony Gemma that he could deliver mail ballot votes in exchange for $500 per week received a $103,000 taxpayer-funded loan for a restaurant from the city of Providence in 2004, GoLocalProv has learned.
The 66-year-old man who received a six-figure taxpayer-funded loan less than 20 months after volunteering on Congressman David Cicilline’s 2002 Mayoral campaign never repaid a dime on the loan, GoLocalProv has learned.
9/4/2012 - Troubled PEDP Hires New Lawyers
The troubled city loan fund that has faced a 60 percent default rate and ran up more than $1.5 million in questionable expenses over the last several years has hired new legal counsel, GoLocalProv has confirmed
Seven businesses that received more than $500,000 in taxpayer-funded loans while Congressman David Cicilline was Mayor of Providence never repaid a dollar before the city wrote the loans off earlier this year, according to information obtained through a public records request.
9/18/2012 - Deported Man Stiffed City on $70,000 PEDP Loan
The owner of a concrete company that received a $70,160 taxpayer-funded loan from the Providence Economic Development Partnership (PEDP) was deported before ever making a single payment on the loan, GoLocalProv has learned.
The Providence Economic Development Partnership (PEDP) intentionally kept severely delinquent taxpayer-funded loans on the books so it wouldn’t have to repay the Department of Housing and Urban Development (HUD) based on its extraordinarily high default rate, the agency’s former executive director told board members during a meeting last year.
10/20/2012 - PEDP Tapped by the 2012 Waste Book
An ongoing investigation into the spending and accountability of the Providence Economic Development Partnership (PEDP) lead by GoLocalProv.com has been recognized by U.S. Senator Tom Coburn (R-OK) in his annual Waste Book 2012.
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