BERWYN – Familia Fresh Market was granted a $50,000 loan by the Berwyn City Council July 8, using collateral future TIF funds promised for building renovations now underway at 3308 S. Oak Park Ave.
In a letter to the City Council, Berwyn Development Corporation (BDC) Executive Director Anthony Griffin explained the BDC will provide a 14-month, $50,000 note to Familia Fresh Market with immediate funding for project costs already approved in the TIF application, approved on April 8. The loan request was prompted by cost overruns on the project. The TIF funds were approved in April for building renovations, signage, plumbing and electrical work.
Aldermen Margaret Paul, 3rd Ward; Robert Fejt, 4th Ward; and Theodore Polashek, 6th Ward, voted against approval of the loan. Polashek said he felt it set a bad precedent for future TIF projects.
"I'm very pro-business and pro-growth for the city of Berwyn. I'm pro-economic development. But, if someone is going to take out a loan they should be putting up their own property against it, as opposed to money that is not even there yet," Polashek said. "Doing this takes away all those TIF safeguards, and we haven't done it before; why do it now?"
Mayor Robert Lovero said such a practice was common in the banking industry.
"I see no reason why we can't do the same," Lovero said.
The loan is to be provided in the form of a promissory note with the future $50,000 TIF pledge to be used as collateral. Familia Fresh Market will also pay a the $4,083 interest on the loan up front.
Familia Fresh Market will be required to pay off the $50,000 loan by Sept. 15, 2015.