UPDATE: Rockford City Council has decided not to reconsider the loan from HUD at the City Council meeting. Alderman Tom McNamara says that means the proposal is dead.
The city could reapply for a new loan next year.
“There’re reasons why there hasn’t been a hotel in downtown Rockford,” said Ald. Tom McNamara (3rd Ward). “It’s not easy to do.”
And it doesn’t come cheap. The developers of both the Amerock and Trekk buildings are seeking $6.4 million from HUD to help transform the buildings into hotels. But they need the City’s help to secure the loan. At Tuesday’s council meeting, that didn’t happen.
“We will help them get the (loan), but I don’t want to say I’ll cosign, pure and simple,” said Ald. Teena Newburg (9th Ward).
Newburg was one of seven who voted “no” because she fears Rockford taxpayers could be on the hook for the money.
“The city is constantly needing repairs and upkeep, and where do we get the money for that if we have to pay a huge payback?” asked Newburg.
But McNamara says the Cty essentially already approved the loan when they penned the development agreements with developers Gorman and Joseph James.
“It was spelled out that they were looking for this money,” said McNamara. “I think it’s (fallen) upon us to follow through on that commitment.”
McNamara says the reward of having two downtown hotels is worth the financial risk. He says even the process to get the $6.4 million would protect taxpayers.
“It’s a good risk to take,” explained McNamara, “as long as (the developers) pass the incredibly thorough examination of their finances and potentially their personal assets.”
Newburg wants the people behind both projects to show her they’re financially solvent before putting taxpayers on the line.
“They’re good projects. There’s good people behind them,” said Newburg. “They just have to work a little more diligently to come up with help…in addition to HUD.”
The loan is expected to come up for another vote at City Council on September 21.