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PEEKSKILL, N.Y. – Entrepreneurs looking to start businesses in the city are facing not just a difficult economy, but hesitant bank loan providers as well.
James Slaughter, Peekskill's director of economic development, told city officials at Tuesday's Committee of the Whole meeting that he had heard from developers that some banks were hesitant to fund projects in the city. Mayor Mary Foster also said the banks are hesitant to fund Peekskill projects.
"They say to them, 'Why do you want to open a business in Peekskill?' " Foster said. "There are a number of entrepreneurs who are putting a lot of time and effort into business plans and retail they're trying to open, and they're running into stone walls – not about their business plan but their choice of location."
Common Council member Kathy Talbot said she heard a similar story from someone who moved into the city recently.
"Their real estate agent said the same thing: 'What do you want to move to Peekskill for?' " Talbot said. "We have a lot of places we need to make some inroads."
Council members discussed if such action by lenders was even legal.
"The reality is, that's unacceptable from any bank," said council member Marybeth McGowan. "What recourse do we have to slap the banks back and say, 'Hey, that's not acceptable?' "
Deputy Mayor Drew Claxton said that studying loans given by local lenders may show a pattern, which is how many banks have been caught redlining. Redlining is the practice of refusing to lend in a defined geographic area, figuratively drawing red lines on a map, and is illegal under federal law.
"If they did a study of how many loans came from those banks to Peekskill as opposed to other places, I would expect the numbers to show it," Claxton said.
"I think a lot of the collateral marketing we're developing will be important for the businesses that are trying to move here, so they're providing that same data to their lenders, so everyone is getting the same information," Foster said.
According to 2010 census data provided by the city, the median family income is $60,678 and the mean (average) family income is $80,061. Median household income is $57,844 and the mean (average) household income is $73,041. The 2011 estimated per-capita income is $32,483. "Median" is the point at which half the numbers are higher and half are lower, and is used by statisticians to provide a more meaningful midpoint than the mean, or average, which can be distorted by extremes at either end.
The city population in 2010 was 23,583, and the average age of residents was 29.6 years old.
Sharing that census data is important to helping lenders understand the city's potential, Slaughter said, as is giving tours of the city to those unfamiliar with it.
"That's going to be part of the strategy – to invite folks up and take them around and give them a good indication of what's here," Slaughter said.
Comments (1)
Now here's where City of Peekskill should hire an attorney and takes some banks to court.