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County leaders at odds over denial of business loan

Published On: Nov 19 2012 06:54:14 PM CST   Updated On: Nov 19 2012 08:57:39 PM CST

SUN PRAIRIE, Wis. -

Some Dane County leaders are at odds over a decision to deny a loan for a Pizza Ranch franchise in Sun Prairie.

In today's economic climate, businesses sometimes need help to gain success. Help is available in the form of Community Development Block Grant loans. The loans are federal money, managed at the county level, which can be loaned out for various community development and business plans.

A local couple tried to take advantage of the low-interest government loan and applied for $250,000 in CDBG funding for a Pizza Ranch franchise they had just purchased.

The couple met the qualifications for the loan. Two county committees approved it. But when it got to the Personnel and Finance Committee, the loan was denied by a 5-2 vote.

"This is the first restaurant that I can remember that applied for a CDBG loan, and we've never given one to a chain before," Dane County Board Chairman Scott McDonnell said.

"Where does it say that?" Dane County Supervisor Dennis O'Loughlin responded. "Tell me where is says that in CDBG, will you, please?"

County leaders are at odds over the decision. Dane County Executive Joe Parisi said he's puzzled by the decision.

"As far as I'm aware, being a chain or not being a chain is not part of the criteria for the loan," Parisi said.

O'Loughlin voted for the loan, saying it is creating jobs and the owners are local.

But McDonnell, who voted against it, said it's a national chain, which shouldn't use public money for financing. McDonnell said in a community that's already saturated with pizza places, the county's support could even drive others in Sun Prairie out of business.

"Basically, it comes down to the fact that this money is intended for small businesses and local businesses that are struggling to get access to private equity," McDonnell said.

O'Loughlin argued that the owners are exactly the people these loans should be helping.

"You're talking about somebody who has invested their life savings, trying to get in on their own. Isn't this what we're trying to do in this state and in this country?" O'Loughlin said.

The local owners of the franchise weren't available for comment on Monday. In a statement, Pizza Ranch said it's disappointed in the decision.

"Although Pizza Ranch is a national restaurant chain, the new restaurant in Sun Prairie is locally owned and operated. Just like every other small business in town, these Pizza Ranch franchisees too have to try to develop a small business on their own," said Jon Moss, chief operating officer of Pizza Ranch, in a statement.

O'Loughlin said he's worried about this county action setting a precedent. He said county board members shouldn't be making up their own criteria for handing out public grant money. O'Loughlin said he believes this small business owner met all the necessary criteria and the loan should have been approved.

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