Status of repayment to RDA not yet clear
In the wake of reports and lawsuits regarding the mismanagement of a $500,000 state grant, the City of Warren commenced a repayment to the Redevelopment Authority to replenish the revolving loan which was to be part of the initial grant.
What the settlement of a 2013 lawsuit means to that effort is not yet clear.
City Manager Nancy Freenock said that the funds of the settlement – $140,000 – “will be used to pay down the $500,000 that the city ‘owes’ the RDA.
The Times Observer previously reported that the city had initially lent the money to GRO-Warren under an agreement to repay the funds over 20 years at four percent interest.
With the dissolution of GRO-Warren and the crumbling of plans to develop an Allegheny Center for the Arts building on Liberty Street, the city was forced to step in for the organization and fulfill the repayment agreement at a total 20-year cost of $727,176.
“Monthly payments have been deposited into a loan fund under the auspices of the RDA,” Freenock said.
“The City makes monthly payments of $3,029.90 that includes both principal and interest,” Finance Officer Donna Risinger said.
She explained that, as of December 31, “the City has made total payments to the RDA in the amount of $181,794: $90,381.08 principal; $91,412.92 interest.”
Risinger said that the loan balance due based on what the City has paid is $409,618.92.
“Moving forward, I am hopeful that DCED (Department of Community and Economic Development) will credit the City the amount received in settlement, plus out of pocket attorney’s fees and costs and payments made to date and consider this matter closed,” Freenock said.