EagleTribune.com, North Andover, MA

Haverhill

December 5, 2012

Condo group to sue city over loan

Officials said promotional materials were erroneous

HAVERHILL — City Council declined to hear a condominium association’s allegation last night that it was deceived by city officials about a building improvement program over concerns the city is about to get hit with a lawsuit.

Those concerns turned out to be well-founded.

Immediately after the council cancelled the discussion, a trustee of the Wingate Street Condominium Association said the condo owners have hired a lawyer and that Mayor James Fiorentini would be served lawsuit papers as soon as today.

The association claims city officials promised a $25,000 loan for facade improvements that it would not have to repay as long as ownership of the property did not change for 10 years. In fact, trustee Tony Feliu brought with him to last night’s meeting documents bearing the city’s official seal titled “Facade Improvement Program” that states “Over a 10 year period, the deferred loan is forgiven.”

In a prior interview, Economic Development Director William Pillsbury acknowledged the condo group was told by his staff it would not have to repay the loan. However, Pillsbury said his staff was mistaken and that “promotional material” on the program was erroneous.

“It was a mistake and we regret it and I’ve apologized to Mr. Feliu,” Pillsbury said Monday. “But we have to be consistent in how we use taxpayer money. As soon as I saw what they were expecting, I said we can’t do this. They never received anything in writing that it would be a free loan. Their contract says they have to pay it back at 1 percent interest over 10 years. We thought that was a pretty good deal.”

Pillsbury said the federally subsidized facade loan program is new and that the Wingate Street condo association is the second group to use it. He said the first business to use it, Bannon’s Spa on Winter Street, paid back a comparable loan for exterior building improvements.

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