City’s Hud Development Grant Less Than Hoped Spokane Also Learned It Qualified For A $23.8 Million Loan From Agency
The city of Spokane learned Thursday it was one of 64 cities nationwide to receive federal money aimed at creating jobs in its urban core.
Spokane will get $1 million in economic development money from the U.S. Department of Housing and Urban Development. That’s less than a third of the city’s original request.
“It’s good news, but it’s not as much as we asked for,” said City Manager Roger Crum.
The city also learned it qualified for a $23.8 million loan from HUD. Both the grant and the loan will be used to build a bigger Nordstrom store - part of a larger plan by River Park Square’s owners to nearly double the downtown mall’s size.
About $45 million in private money will be used to build a movie theater, food court, a glass-enclosed Post Street atrium and space for local retailers and national chains.
The public-private partnership is headed by Citizens Realty Co. and Lincoln Investments Co., owners of River Park Square and affiliates of Cowles Publishing Co., which owns The Spokesman-Review.
The city had requested $3.6 million in HUD grant money, but came away with $1 million.
“We’re very appreciative of the grant,” said Nancy Goodspeed, consultant for the River Park Square project. She added that getting less than originally requested will make it “more difficult.”
Because the project’s budget is tight, the mall’s owners will have to “look at figures to see ways we can come up with $2.6 million,” Goodspeed said. “We will find that piece of it.”
The grant money will be used to pay the first year’s interest on the federally guaranteed loan, as well as reduce the annual principal payments each year thereafter.
Fewer than half of the 130 cities applying for the competitive grant came away winners. Nearly $50 million in grants and $190 million in loans were given out nationwide.
“Our first priority in urban revitalization is to create jobs,” said HUD Assistant Secretary Andrew Cuomo in a written statement. “The EDI grant provides communities with the tools they need to restore economic growth in distressed areas.”
The council voted Monday to apply for the federal loan, and Crum was surprised to learn it had been approved so quickly.
“We knew they liked the project,” Crum said.
The loan will be repaid over 20 years with lease payments from Nordstrom and surrounding property owners.
Some people had criticized the council for putting taxpayers at risk for the HUD loan, saying that if the project fails they’ll be forced to foot the bill.
If the developers or Nordstrom default and the money can’t be collected from either party, the city’s community development block grants could be used to pay off the loan. If those weren’t available, HUD guarantees the loan, so it would pay off investors.
No city general fund money would ever be used, city staff said.
, DataTimes