BRUNSWICK — Residents and town councilors had questions and comments Tuesday after last week’s report about an unusual loan by the Brunswick Development Corp. to a business owned by the husband of a former councilor and BDC director.

Last week, Councilors John Perreault and Benet Pols criticized BDC’s forgivable $247,000 loan to Brunswick Taxi, which is owned by the husband of former Councilor Joanne King. They said there is too much potential for conflict of interest because the BDC board includes town councilors and administrators.

At the council’s Tuesday night meeting, Chairwoman Suzan Wilson initially skirted any questions about BDC from the public and suggested residents direct questions and concerns to BDC President Larissa Darcy or at the BDC’s monthly meetings.

“The BDC is a a separate entity from the Town Council,” said Wilson, who is also a BDC board member. “Its funding is separate from the town. We have no authority as a council over the BDC, including their loans or their business.”

The BDC board – which includes Wilson, Councilor John Richardson, Town Manager Gary Brown, and Finance Director John Eldridge – is next scheduled to meet on Sept. 18 at noon in the first floor of the McLellan Building on Union Street.

Vincent DiCara, a local financial consultant, avoided direct discussion of BDC and its loan activities. But he told the council how two similar organizations for which he consults – the Greater Portland Council of Governments and Portland Development Corp. – operate when lending money to small businesses.

“I want to talk in general terms of how these funds operate,” DiCara said, “and hopefully it will benefit those of you in the council who are interested in lending money to businesses in this community.”

DiCara said lending programs at GPCOG and PDC are designed to fill financing gaps “when conventional financing is not available to meet the business needs of businesses in a particular community.”

“So in other words, these funds don’t lend money to businesses unless those businesses can’t find financing somewhere else,” he said.

DiCara also said organizations like GPCOG and PDC usually lend money in partnership with a local bank, credit union or lending institution.

The financial consultant also noted that GPCOG’s loan committee does not contain any appointed or elected officials. Instead, it contains members who are appointed by an executive committee, which is comprised of appointed and elected officials from Cumberland County.

For PDC, DiCara said there are only two city officials – the mayor and the city manager – out of the 11 total members on PDC’s loan committee.

“Hopefully this information will be useful to you moving forward,” he said in closing.

After two residents spoke, Wilson fielded questions from other councilors about BDC’s bylaws and how members are appointed.

Wilson said the BDC’s bylaws are in flux and said residents and others are free to weigh in on possible changes at future BDC meetings.

The chairwoman clarified after the council meeting that the BDC’s review of its bylaws have been part of an ongoing discussion and is not a reaction to the recent publicity.

She said although changes to the bylaws are not imminent, a regular review of bylaws is a good practice for organizations like BDC.

Dylan Martin can be reached at 781-3661 ext. 100 or dmartin@theforecaster.net. Follow him on Twitter: @DylanLJMartin.

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