After a good bit of political wrangling, the Denver City Council earlier this month approved a $2.9 million contract with a nonprofit investment group working to improve Denver’s most impoverished neighborhoods.
We were glad to see they had done so.
The dustup over the Seedco Financial contract had to do with findings in a monitoring report on the nonprofit’s performance. Concerns were raised about invoicing practices, record-keeping and the handling of grant money that came through the city.
Council members were right to look into issues involving a startup nonprofit — we would expect no less from the stewards of taxpayer money — but the bottom line is the matters were minor and well on their way to being resolved.
It’s important that concerns have been assuaged because Seedco holds promise for economic redevelopment in some of Denver’s hard-bitten neighborhoods.
Seedco is a national, nonprofit community development financial institution that lends money to businesses operating in neighborhoods overlooked or ignored by mainstream banks.
Seedco’s arm operating in Denver uses federal grant money passed on by the city, in conjunction with private investment, to make deals happen that probably wouldn’t have. And that’s a good thing.
Peter Chapman, who had been a policy adviser to Mayor John Hickenlooper, left the city in 2007 to run the Seedco startup in Denver. When Chapman, the executive director, spoke with us recently, he gave us an example of a deal Seedco made.
A small telecommunications installation business, which hires ex-convicts and people with social and educational challenges, had a shot at a big job during the Democratic National Convention. But the company didn’t have enough capital to rent certain equipment and hire the temporary technical assistance needed for the job until Seedco lent it $200,000.
“We’re very proud of that deal,” Chapman said. “We’re proud of them.”
Admittedly, the scale that Seedco operates on — a loan here and a small housing complex there — may not change the world. But it has the potential to help target neighborhoods, and during these times of tight credit, every little bit helps.
Chapman and others working with the group offered assurances that issues the city raised about how Seedco was operating have been resolved. “Can we account for every dollar?” asked Paul Franke, a lawyer who chairs Seedco’s Denver board. “The answer is yes.”
We hope so.
Seedco now is meeting with the city on a monthly basis to ensure everyone sees eye to eye on procedure.
We look forward to more good work from Seedco and continued vigilance from the council.
