Missoula County waives $150K in loan debt for two local non-profits
Martin Kidston/Missoula Current
Missoula County forgave nearly $150,000 in loan debt owed by two nonprofits on Tuesday, saying they provided a community benefit.
Free Cycles saw more than $87,000 in debt forgiven while Homeword had roughly $62,000 in debt forgiven. Both loans were provided by the county years ago through its Community Development Block Grant revolving loan fund.
“It makes a great deal of sense to take a look at the non-profits in a different way than we would the for-profit business as it relates to community benefit,” said Commissioner Dave Strohmaier. “It's something we have within our jurisdiction to do, and I think it will be a big help."
Free Cycles took a Community Development Block Grant loan from the county in 2017 in the amount of $105,000 to help cover the purchase of the organization's current building.
Melissa Gordon, a grants administrator with the county, said in exchange for the loan, Free Cycles had to create the equivalent of three full-time positions, with 2.5 of them going to low- and moderate-income individuals.
“Free Cycles is in good standing with their loan payments, and they've created the jobs associated with the original loan,” said Gordon. “This is a request to forgive the remaining balance of the loan, which is the $87,040.”
Likewise, Homeword took an $81,000 loan from the county through the Community Development Block Grant program in 2013. The funding helped the organization purchase and remodel a property at 1805 Phillips Street, which contains eight affordable rental units.
In forgiving Homeword's remaining debt of $61,917, commissioners determined the organization was also providing a community benefit.
“Those are dedicated to low- and moderate-income clients,” said Gordon. “Homeword will continue to provide services that benefit low- and moderate-income persons at this property.”
The county issued four such loans from the same portfolios, two of which also went to for-profit businesses. Gordon said the county determined that non-profit and for-profit businesses provided different values.
The loans to the two for-profit businesses were not forgiven.
“It was determined that the non-profit businesses that had received loan funding were providing an ongoing benefit to low- and moderate-income clients in the community in a way that's much different than the work the for-profit businesses are doing in the community,” Gordon said.