PA is broke but Rendell manages to loan 35 million to Boscov's ?!?!

[son of the revolution]

PA is broke and Rendell wants to pout , yet still somehow manages to , with the help of Scranton and Wilkes Barre to loan Reading based Boscov's Dept Stores 35 million dollars ???


http://www.lehighvalleylive.com/brea...ion_in_lo.html

[Skeptic]

Oh sure they are losing money on that transaction but they will make it up in volume

Just insane what the people of both the Federal government and many of the Several States are doing these days.

[H.E. Pennypacker]

This is old news - November 2008. I guess the geniuses in Harrisburg couldn't foresee any rockiness on the road ahead.

[son of the revolution]

This is old news - November 2008. I guess the geniuses in Harrisburg couldn't foresee any rockiness on the road ahead.

yes it may have started back in Nov 08 but that doesnt mean they had to follow through with it !! Just another tax payer funded bailout , albeit on the local State level .

[cgbudde]

This is old news - November 2008. I guess the geniuses in Harrisburg couldn't foresee any rockiness on the road ahead.

They didn't care. wonder how close Rendell and the Boscov family is.

[mjfletcher]

Pennsylvania pledges $35 million in loans to help Boscov's
by Express-Times staff and wire
Thursday November 20, 2008, 12:35 PM

Pennsylvania Gov. Ed Rendell says the state has secured $35 million in federal loans to help regional department store chain Boscov's exit bankruptcy.

Rendell said today the loans would be financed through a program that allows governments to guarantee loans for economic development with federal community development block grants.

Reading-based Boscov's filed for Chapter 11 protection in August and announced that it would close 10 of its 49 stores. Its two regional stores, at Palmer Park Mall and Lehigh Valley Mall, are not among those closing.

Rendell says Boscov's won't have access to the federal loans if it can't obtain bridge loans that are part of more than $300 million in financing the chain will need to exit bankruptcy.

Boscov's is in the midst of court hearings in Delaware on its bankruptcy sale to two former executives.

"It would be devastating in the state of Pennsylvania to lose Boscov's," Rendell said.

Pennlive.com reports the family also is receiving $6 million in federal funding from the cities of Scranton and Wilkes-Barre. Rendell said Boscov and other family members are putting in $53 million of their own equity.

A hearing has been scheduled for 11 a.m. Friday on the sale of the Boscov's assets. Boscov's filed for Chapter 11 bankruptcy protection on Aug. 4 in the U.S. Bankruptcy Court in Delaware.

PA isn't lending them anything, PA, Scranton, and Wilkes-Barre got them loans from the federal govt that came out of money the fed makes available for things like community development, improvement, etc.

I don't know how close Rendell and Boscov are, but I do know that Reading and the Boscov family have a long history. I live around the corner from the location of the original Boscovs store. The Boscov family founded "Our City Reading" to help improve Reading and give back to the community that gave them the opportunity to build their chain of stores.

The stores started out as completely privately owned, the business was incorporated, the corporate managers managed it badly and it started going under. The family stepped in and was able to negotiate a deal that allowed Boscov's to go into Ch11, restructure, and come back out family owned again in order to avoid a chapter 13 that would have closed all the stores and put alot of ppl out of work.

The corporate managers that screwed the company and ran it into the ground are gone, the family that built the business up from one store to over 30 before it was incorporated are back in charge and they're already projecting profits rather than losses.

[son of the revolution]

PA isn't lending them anything, PA, Scranton, and Wilkes-Barre got them loans from the federal govt that came out of money the fed makes available for things like community development, improvement, etc.

I don't know how close Rendell and Boscov are, but I do know that Reading and the Boscov family have a long history. I live around the corner from the location of the original Boscovs store. The Boscov family founded "Our City Reading" to help improve Reading and give back to the community that gave them the opportunity to build their chain of stores.

The stores started out as completely privately owned, the business was incorporated, the corporate managers managed it badly and it started going under. The family stepped in and was able to negotiate a deal that allowed Boscov's to go into Ch11, restructure, and come back out family owned again in order to avoid a chapter 13 that would have closed all the stores and put alot of ppl out of work.

The corporate managers that screwed the company and ran it into the ground are gone, the family that built the business up from one store to over 30 before it was incorporated are back in charge and they're already projecting profits rather than losses.

Doesnt change the facts that those loans have been " guarenteed " by PA and the respective Cities . Doesnt change the fact that if they can get loans from the Feds for a private business , they can do more and better things for the residents with the money . Like I said Fed or State its still OUR money , being used.

[mjfletcher]

Doesnt change the facts that those loans have been " guarenteed " by PA and the respective Cities . Doesnt change the fact that if they can get loans from the Feds for a private business , they can do more and better things for the residents with the money . Like I said Fed or State its still OUR money , being used.

Its also Boscov's money being used, the corporation and the Boscov family paid federal income tax too.

Boscov and other family members are putting in $53 million of their own equity.

What was the gross they had before federal income taxes and how much were those fed taxes that resulted in them having $53 million after taxes? I'd be willing to bet that most, if not all, of the money they're getting in loans is coming from federal taxes that they paid to begin with. They're getting their own money lent to them and they'll be paying it back with interest.

The loans are also going to a family that's invested literally millions of their own dollars into improving the community that gave them their start. Its that community mindedness that caused the local politicians to work on getting the state to get them the loans. They've given to the community since the day they started their business, and that community that paid those federal taxes wants some of that tax money used to help them.

I'll admit I may be a little biased, but knowing all the things they've done for the community with their own money, they've more than earned a little support from the government in getting their business back to where it was before corporate interests screwed it up, and I have no problem with a government loan that puts a corporate business back into private hands.

As far as better uses for the money, the income the Boscov family received from the chain of stores is what allowed them to give to the community. It's what allowed them to start Our City Reading. Its what allows them to buy dilapidated homes, renovate them, sell them at fair market value (which puts them all below actual market value here). Their position in the business community is what gives them the leverage to arrange low fixed interest mortgages for first time home buyers buying the homes they fix up. Their position in the business community is why downtown Reading isn't the blighted crime zone it once was. Instead of abandoned, boarded up dept stores that closed 25+ years ago there's multi story office buildings. Instead of a collapsing theater that closed 20+ years ago theres a civic center. Instead of an abandoned factory theres center for the arts. Instead of a dilapidated, disused theater theres a performing arts center.

All of it thanks to the Boscov family and department stores.

Reading went from holding a place in the top 30 most dangerous cities list put out by Morgan Quinto every year for 15 years running, peaking at 6, to not even making the top 50 and a huge part of that is improvements to Reading and Berks that happened only because of the Boscov family and their stores.

What better use than providing the means for renters to become first time home buyers by turning abandoned homes into places you'd be proud to raise a family in, creating jobs, increasing the tax base through new businesses and tourism, and reducing crime can you think of?

If it wasn't for the Boscov's stores, the Boscov family wouldn't have been able to start Our City Reading. Our City Reading has been, and continues to be, the powerhouse behind all the the previously mentioned improvements to the community. Al Boscov, his family, and the business he father started have done more to improve the community using their own money and influence than the government ever has. They've more than earned financial backing from the government.

[bt-99]

Begging the question of whether or not the Boscov Family has been civic minded,why is it ever an appropriate use of tax payer dollars to support a private enterprise?
If we had lower taxes, both business and corporate, we would attract more business to PA. More people would have cash in their pockets, and we could individually decide who to support,not Ed Rendell supporting his donors with our tax dollars!

[shooter357]

Its also Boscov's money being used, the corporation and the Boscov family paid federal income tax too.



What was the gross they had before federal income taxes and how much were those fed taxes that resulted in them having $53 million after taxes? I'd be willing to bet that most, if not all, of the money they're getting in loans is coming from federal taxes that they paid to begin with. They're getting their own money lent to them and they'll be paying it back with interest.

I pay taxes too. Can I get one of them loans? The reason that the Boscov family put in their money is because it is their company.

I do not believe in any part of .gov "investing" in any part of private buisness. Should a company be able to survive depends on how well the company is run. In this case, it was being run bad and if they are to survive should depend on how well it is managed from here on.

Kepp in mind that there is no "your" money or "my" money in taxes, it is "our" money and it effects all of us.