Half Million Dollar Taxpayer Loan To East Grand Forks Business Hasn't Been Paid On In 15 Years
How exactly does something like this happen?
The city’s Economic Development Housing Authority held a special meeting Tuesday to discuss the $510,000 loan the body gave to Boardwalk Enterprises in 1999. There hasn’t been any payment on the loan since that time, city staff said.
So the city made the loan in 1999. Now, about fifteen years later, there hasn’t been a single payment made on the half-million dollar loan. The city doesn’t even seem to know who owns the company that got the loan.
And did I mention that the mayor’s brother is involved?
City Attorney Ron Galstad said after the meeting that he wasn’t sure who exactly makes up Boardwalk Enterprises, but said he’s been in contact with Dan Stauss, who is the brother of Mayor Stauss.
“I knew nothing about that loan,” Mayor Stauss told the Herald, adding that he’s not involved with Boardwalk Enterprises.
Stauss was mayor when the original loan was made. Galstad said the ownership of the building has changed since then.
Here’s more from WDAZ:
City staff met with board members of East Grand Forks’ Economic Development and Housing Authority Tuesday to discuss the outstanding loan, which was originally made in 1999. The EDHA lent Boardwalk Enterprises $510,000 at zero interest to help construct the building which currently houses the Drunken Noodle and Boardwalk Bar and Grill restaurants, staff said.
Annual $30,000 payments were scheduled to start in October 2003 and finish in 2019, according to a loan agreement provided by city administrator David Murphy. But those payments never came, city attorney Ron Galstad said.
“There hasn’t been any payments on it,” Galstad said.
Jim Richter, the EDHA executive director who originally signed the loan agreement, declined to comment after the meeting Tuesday.
Your tax dollars, hard at work.