County Committee Agrees to File Suit Against Delinquent Borrower

The Effingham County Board's Economic Development Advisory Board has loaned several start-up businesses funds, but some have been slow to pay back the loaned funds. That reality led the Advisory Board Tuesday to decide to file suit against one borrower in an effort to get the funds back.

Some of the start-up businesses have been given extra time to repay the funds, but the suit is being lodged against a business that is more than a year in arrears. Not only that, but the business is no longer in operation, so the County faces a tough battle in getting back the loaned money.

The Advisory Board is using just under $100,000 in grant money to loan to the start-ups, with a promise in the agreement with the businesses that the funds will be repaid so they can be loaned again to additional firms. The businesses must also pledge securities, often the equipment used to operate the businesses.

While the lawsuit is being filed against the one business, another start-up is seven months behind in repayments and others are three to four months behind.

In the meantime, the Advisory Board Tuesday also reviewed a revised loan agreement to prospective businesses. A vote on the revised agreement could come at the Board's February meeting.

It's a tough call for the Advisory Board, that understands it's making money available to start-ups that might not qualify for funds from financial institutions, but feels an obligation to recover money that belongs to the County. 

Advisory Board member Jeff Simpson said everyone that counsels with them, seeking funds, is excited about their proposal, but added that "if they weren't excited, we wouldn't be interested in making money available."

There was good news at the meeting. One firm that has had consistent trouble staying current on its repayments is now current with their payments.