Weeks after City Council meeting, still no public information on EDC loan
by Franklin Clark, Reporter -- fclark@cadizrecord.com
Oct 30, 2013 | 447 447 recommendations | email to a friend | print
At their last meeting, Cadiz City Council members had Cadiz City Attorney Allen Wilson look into the City’s responsibility for a $200,000 loan authorized by the Cadiz-Trigg County EDC (Economic Development Commission).

Three weeks later – yesterday, in fact – Mayor Lyn Bailey met with Cadiz City Council members Gary Polete and Manuel Brown to see what they knew. As it turned out, it was an informal meeting and wasn’t meant to be a public meeting. It was called off because I was there.

According to the Kentucky League of Cities, that constituted a legal meeting, as up to two council members can meet at any time. However, a series of such meetings could constitute a problem.

But in any case, none present seemed to know anything more about the loan or the EDC’s finances than when the City Council had their regular meeting roughly three weeks ago.

This all started when questions were asked then about an item in the montlhy expense report titled “EDC Loan Payment” for $2,500.

After a bit of discussion, Council members voted to put a hold on all further loan payments until Wilson can determine whether the City of Cadiz is responsible for the EDC’s debts and what say the City has in the EDC’s authorization to borrow money.

The chairman of the EDC is Don Leibee. He’s also the president of the Bank of Cadiz, the bank that signed off on the loan in the first place.

I will not judge Leibee harshly – or at all, in fact – in this editorial. I have little doubt that there is no actual conflict of interest involved here. But I have to admit that to an outsider, and even to some who live here, it probably doesn’t look too great.

Bailey indicated that the loan was related the Transcraft’s expansion project last year. That seems like a legitimate reason for a loan; Transcraft, which produces aluminum trailers, employs lots of people in the area. Now, they have layed some people off recently, including one of my neighbors. To be fair to them, however, sales have been down compared to last year.

My primary reason for writing this is because it is an open question as to whether the EDC has the authority to authorize loans in its own name independent of the City Council’s direct say-so and then have them foot the bill. It’s something that needs to be clarified.

The City Council is elected directly: while they may have the best of intentions, EDC members and officers are not elected. The fact that many City Council members seemed unaware of the loan at that meeting is also troubling. To borrow a phrase from “Cool Hand Luke,” it seems like a failure to communicate.

In any case, we’ll probably know more on Tuesday, when the City Council meets again. There will definitely be a story about it in The Cadiz Record in our Wednesday, Nov. 13, edition, and possibly something on our web site before that, depending on what is determined.

Franklin Clark is a reporter for the Cadiz Record and can be reached by email at fclark@cadizrecord.com.
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