Department
Department of Community Development
Requested Action (Identify appropriate Action or Motion, purpose, cost, timeframe, etc.)
title
The Department of Community Development request approval of a Resolution approving the orderly closeout of the Fulton County Business Improvement Loan Program (BILP) consistent with the framework approved by the Department of Community Development; and authorizes the County Manager or His Designee to execute all necessary and related documents to implement the policy for the BILP and to effectuate its closeout; and for other related purposes. (APPROVED)
body
Requirement for Board Action (Cite specific Board policy, statute or code requirement)
In accordance with meeting the HUD National Objective for Economic Development. Statutory Citations Section 101(c), Section 104 (b), Section 105 (c), 570.208, 570.506.
Strategic Priority Area related to this item (If yes, note strategic priority area below)
Health and Human Services
Commission Districts Affected
All Districts ☒
District 1 ☐
District 2 ☐
District 3 ☐
District 4 ☐
District 5 ☐
District 6 ☐
Is this a purchasing item?
No
Summary & Background (First sentence includes Agency recommendation. Provide an executive summary of the action that gives an overview of the relevant details for the item.)
The Department of Community Development recommends Board approval to orderly close out the Fulton County Business Improvement Loan Program (BILP) program and implement a loan collection policy to effectuate its closeout.
The department continues to have a reoccurring audit finding related to the administration of a defunct Business Improvement Loan Program (BILP). The loan servicing system, Loan Management Software (LMS), that has been historically used to track the loans, went out of business in 2018 and with the exception of six (6) of the businesses who received loans from the County, all have been dissolved by the Secretary of State. Of the remaining six active businesses, approximately $191k in funding is uncollected.
However, two of the remaining borrowers have offered settlements of their outstanding loan balance. Guidance from HUD and our HUD consultant, Mullin and Lonergan (M&L), was to develop a policy that guided the process for handling settlement offers and eventual dissolution of the program. The attached policy was developed and has been reviewed by M&L and HUD.
The department is seeking BOC approval to continue reasonable collection efforts of the remaining loans, discharge debt that is uncollectable according to the approved policy, and dissolve the BILP program by end of year 2021.
Historical records indicate the Business Improvement Loan Program (BILP) was funded using County administered CDBG federal dollars in years 2004, 2005, 2006, 2007, 2010, 2011, to the Economic Development Corporation of Fulton County (EDCFC), a not-for-profit entity, under an Inter- Agency contractual agreement. Primarily, funds were administered to provide: financial assistance to start-up businesses, job creation for low -moderate income citizens, and administrative support and sustainability of the EDCFC. According to the County Attorney’s Office, the Economic Development Corporation of Fulton County (EDCFC) was administratively dissolved in 2019.
Scope of Work: Pursuant to Title I of the Housing and Community Development Act of 1974, as amended, the U.S. Department of Housing and Urban Development (HUD) provides funds to entitlement communities to support various community and economic development activities. The Business Improvement Loan Program (BILP) is a federally funded economic development activity designed to facilitate small business development in Fulton County. The primary goal of this program is the meet the HUD National Objective with the creation and retention of jobs for low and moderate-income persons. Since 2004, the program did meet the National Objective as reported annually in the Consolidated Annual Performance and Evaluation Report (CAPER).
Community Impact: The Business Improvement Loan Program (BILP) has made an impact on small business development within Fulton County in prior years
Department Recommendation: The Department of Community Development recommends approval to orderly close out the Fulton County BILP program and implement a loan collection policy to effectuate its closeout.
Project Implications: Approval of this policy will the Department of Community Development to focus on the delivery of timely community development services to Fulton County citizens who reside outside of Atlanta.
Community Issues/Concerns: There are no community concerns identified.
Department Issues/Concerns: If the CDBG Business Improvement Loan Program (BILP) Collection Policy is not approved, this will limit the County’s ability to properly close out this program and implement a loan collections policy.