The Journal Times has an article today, curiously titled "Staying afloat," about a non-profit housing agency that is sinking fast.
The Racine Mutual Housing Association is a nonprofit organization that provides rental housing at below-market rates, according to the JT. Yet 95% of their clients are behind in their rent payments. The city will now allow RMHA to skip their payments to the city for the next ten months. Presently, the group owes $193,000 plus interest (interest amount not specified in the article) on a $200,000 loan made several years ago.
City Development Director Brian O'Connell said the group needs sound fiscal judgement to balance its compassion. In showing patience with struggling tenants, "they've put the whole organization at risk" O'Connell said.
The same might be said of the city. The city needs sound fiscal judgement to balance its compassion. In showing patience with struggling borrowers (several years, barely a dent in principal) the city is putting all the taxpayers at risk.
The best judgement of all would be for the city to leave banking to bankers and fire the bureaucrats who are wasting our money.