Elyria forgives loan to the Community Improvement Corporation

Elyria City Council will forgive a loan worth around $190,000 it made to the Elyria Community Improvement Corp. in 2019. Council voted unanimously to forgive a loan Monday, which as of Sept. 9 was valued at $192,890, Finance Director Ted Pileski said. The corporation is run by a board made up of members of Council, the administration of Mayor Kevin Brubaker and the public. Its role is to drive economic development by acquiring unused buildings or lots and helping to redevelop them. The CIC worked with the Elyria Public Library System to clear room for the construction of the new main branch downtown, and the city at the time had given the corporation roughly $500,000 to help with its work. That money came partially in the form of a loan for $350,000. The rest was a gift. The corporation used that money to help the library acquire the land it needed while relocating the businesses that had previously been there, attorney Mark Craig said. Part of that amount was forgiven in 2020, Pileski said, but the loan of $192,890 was still on the books of both the city and the CIC. Craig is the administrative legal counsel for the administration of Mayor Kevin Brubaker. He went before Council's Finance Committee on Sept. 9 to ask the loan be forgiven. "At that time, we believe the City Council and administration intended for that loan to be forgiven at some point," Craig said. "Obviously we've had some hard times since then, but we think we're in a position now where we want to continue to allow the CIC to have resources and pursue its goals of economic development." At the Sept. 9 meeting, Councilman Phil Tollett asked Pileski if the city's bond rates would be affected by forgiving the loan. Pileski said bond rates would not be affected and added "I don't have a problem if you forgive it. Council President Vic Stewart said he believed the original intent was to have the loan repaid, and questioned why that was no longer an option. "Most of the time when we get involved in a transaction, it's not profitable," Craig said. "And so it's good to have as much cash as we can to take on some of the bigger projects or more projects. Rather than take this money and funnel it back to the city, we'd prefer to keep it in the economic development engine that is the CIC so we can use it for future projects." Finance approved the request unanimously and Council as a whole did the same on Monday, meaning that the CIC will not have to pay back the loan it received in 2019. Contact Owen MacMillan at (440) 329-7123 or omacmillan@chroniclet.com.