A few months ago they made the laughable claim that "due diligence is a way of life" at the IDA. This, from an outfit that didn't even do a basic public records check on Stokes and his restaurant, one that would have screamed "do not lend money to this business!"
Now, earlier this week, the IDA staged a press event in which it trotted out some of the other minority business owners who borrowed money at the same time as Stokes in an effort to make the point that not all the loans went bad. In fact, the IDA says, nine other loans made at the same time are panning out.
Perhaps a bit of perspective is in order, however.
For starters, a report released by the IDA in February showed that nearly half of the money its Regional Development Corp. has lent to minority businesses over the years has not been paid back. As in 43.6 percent. Compared with 12.7 percent for all loans.
In other words, the RDC's track record when it comes to lending to minority business is abysmal.
Don't get me wrong. We need to seed minority-owned businesses. But we also need to be smart about it. And the record strongly suggests the IDA/RDC isn't.
But there's more.
I inquired last month as to the repayment status of the RDC's current loans. The Buffalo Economic Renaissance Corp. routinely makes this information available. But not the RDC/IDA. It responded to my recent Freedom of Information request with a denial.
I called Bob Freeman, executive director of the New York State Committee on Open Government, and he termed the IDA's position "ridiculous." I've filed an appeal.
Think about it -- a public agency is lending money to businesses and claiming that it's none of the public's business whether the money is being repaid, at least not until the loans go officially belly up. Thus, the IDA is less transparent than BERC.
I'm not the only one the IDA is trying to stiff for this information. County Comptroller Mark Poloncarz is having the same problem getting this data.
One final bit of information. The IDA is paying good money for all I reference above.
taggedEconomic Development | One Sunset