The Wall Street Journal - 14.11.2019

THE WALL STREET JOURNAL. **** Thursday, November 14, 2019 |A10A

“Once you’re approved for a

line of credit, you can use it

strategically, and that positions

a woman entrepreneur to re-

spond to market conditions and

opportunities,” said Ms. Carin.

The program’s 12% interest

is a reasonable rate for bor-

rowers with a credit score of

620, she said.

The program is a public-pri-

vate venture, with Goldman

Sachs 10,000 Small Businesses

contributing $5 million and Fun-

dation, an online lender, con-

tributing $500,000 in capital to

support the lines of credit. A $

million loan-loss reserve is be-

ing funded by Squarespace and

the New York City Economic De-

velopment Corporation.

The Department of Small

Business Services did a soft

launch about a month ago and

has received 13 applications.

Cathy LaCognata applied

and was approved for a $75,

line of credit. She struggled for

years to find affordable loans,

turning to friends and family

when she needed money for

her business, a boutique gym

based in Brooklyn.

The 51-year-old has experi-

enced several setbacks since

becoming an entrepreneur in

2011 after years as a stay-at-

home mom. The building that

housed her first location in

the Rockaways was swamped

by superstorm Sandy in 2012.

Then she separated from her

husband, and her credit score

suffered as bills went unpaid.

“Getting funding is always a

problem,” she said. “Not hav-

ing a great credit score, no one

was going to lend me money.”

Ms. LaCognata improved her

credit score to 730 from 530

after getting guidance from the

Goldman Sachs 10,000 Small

Businesses program, which she

completed earlier this year.

She said she plans to use her

new line of credit to renovate

and buy equipment.

New York City is launching

a program to close the gap be-

tween men and women when

it comes to financing their

businesses.

The Department of Small

Business Services’ $5 million

program will offer lines of

credit up to $100,000 at about

12% interest to women-owned

businesses, said Gregg Bishop,

commissioner of the depart-

ment. Entrepreneurs with credit

scores of at least 620 who have

been in business a year or lon-

ger and earn $50,000 or more

in annual revenue can apply.

The department surveyed

more than 1,600 entrepreneurs

in New York City for a 2015 re-

port that found women are

more hesitant than men to

take out high-interest loans.

Female entrepreneurs are more

likely than their male counter-

parts to see their loan applica-

tions rejected or underfunded.

“Women tend to be more

risk averse,” Mr. Bishop said.

Lines of credit are particu-

larly helpful for business-

women who only want to bor-

row and pay interest when

they need funding, as opposed

to applying for large loans, said

Nancy Carin, executive director

at the Business Outreach Cen-

ter Network, a nonprofit small-

business development organi-

zation. Lines of credit also

provide fast access to cash,

particularly helpful for busi-

nesses that might need quick

capital during busy holidays.

BYKATEKING

NYC Businesswomen Receive Boost

From Public-Private Credit Program

The sites include property around the East River and Anable Basin.

KEVIN HAGEN FOR THE WALL STREET JOURNAL

GREATER NEW YORK

tute was hit with a $143,

judgment, after the state attor-

ney general’s office sued it for

allegedly misusing grants from

the state’s Office of Victims

Services, court records show.

The lawsuit was filed in 2018

after a Victims Services’ probe

found the institute used grant

money to fund immigration ser-

vices rather than to help crime

victims, the records state.

The investigation also

found the institute didn’t tell

the state that Acacia Network

Housing Inc., a large non-

profit, took it over in 2016, the

lawsuit says. The takeover

came after the city’s Depart-

ment of Investigation opened

a probe into the leadership of

the institute, the lawsuit says.

In a 2014 report, DOI inves-

tigators said the probe found

the institute’s then-executive

director misused funds. No

criminal charges were brought

against the executive director

or the institute. The executive

director no longer works for

the institute, according to

Acacia.

A spokesman for the attor-

ney general’s office said the in-

stitute didn’t respond to the

state’s lawsuit. The judgment

is currently enrolled in a state

program that intercepts money

from state tax refunds or any

state contract payments.

Neither Acacia nor the insti-

tute was notified of the judg-

ment, said John Schiumo, an

Acacia spokesman, adding that

Acacia and the institute would

either take immediate steps to

vacate the judgment or pay it.

“Acacia Network was not a

party to this judgment, was not

responsible for it or subject to

it, and was never notified of it

until it was brought to our at-

tention last week,” Mr. Schi-

umo said.

The Department for the Ag-

ing has contracted with the in-

stitute since 1997. The city has

doled out more than $15 mil-

lion dollars in contracts to the

institute since 2015.

Zenovia Earle, a spokes-

woman for the Department for

the Aging, said her agency

wasn’t aware of the state probe.

The New York grants that

prompted the state investiga-

tion aren’t affiliated with the

city contracts, she said.

The institute’s “contracts

with the New York City De-

partment for the Aging are in

good standing,” Ms. Earle said.

The nonprofit was selected

through the city’s request for

proposals process that evalu-

ated its ability to serve older

residents, she said. The city

contracts are subject to an

evaluation, audits and feed-

back, Ms. Earle noted.

The institute is one of more

than 70 organizations affili-

ated with the Bronx-based

Acacia Network, which has ab-

sorbed smaller Latino non-

profits that have had financial

or administrative difficulties.

Acacia is under investiga-

tion by the city concerning al-

leged undisclosed ties to a for-

profit security firm.

The organization, one of

New York City’s top homeless-

shelter operators, has received

more than $1 billion in con-

tracts through the Department

of Homeless Services to run

shelters since 2010, according

to the city comptroller’s office.

The city began investigat-

ing Acacia for not disclosing in

city documents that it owns

and operates its top subcon-

tractor, the for-profit Sera Se-

curity Services, as well as the

for-profit Distinctive Mainte-

nance.

New York Gov. Andrew

Cuomo last month ordered an

investigation into Acacia and a

housing-management company

that run affordable-housing

apartments in the Bronx, fol-

lowing allegations of bedbugs

and drug-related crime in

some buildings.

Mr. Schiumo has said there

weren’t bedbugs in the building

and the nonprofit welcomes

the investigation by the state.

New York City officials re-

cently gave $5.3 million in

contracts to a nonprofit that

owes the state $143,678 for al-

legedly misusing grant money.

The city’s Department for

the Aging awarded the con-

tracts to the nonprofit Insti-

tute for the Puerto Rican/His-

panic Elderly last month to

provide services for senior cit-

izens in the Bronx, Queens and

Manhattan between Dec. 1,

2019, and June 30, 2021.

This past January the insti-

BYKATIEHONAN

Nonprofit That Owes State Gets Contracts

Organization hit with

$143,678 judgment for

allegedly misusing grant

money lands city work

After years of struggling, Cathy LaCognata, center, got a $75,000 line of credit for Training for Warriors, her Brooklyn-based gym.

KEVIN HAGEN FOR THE WALL STREET JOURNAL (2)

The former Amazon sites

up for development are con-

trolled by the three real-estate

development firms and Plaxall

Inc., a longtime manufacturing

company in Long Island City.

The land includes private and

city-owned property around

the East River and Anable Ba-

sin. Together the sites com-

prise about 22 acres.

The four companies say they

don’t have plans as of yet for

the sites, but development

would require city rezoning.

They say they are eager to get

community input and work with

the New York City Council,

which was left out of the Ama-

zon deal. The City Council’s

land-use team wants the sites

developed in a cohesive manner.

A spokeswoman for the

city’s Economic Development

Corp., which led the de Blasio

administration’s efforts to reel

in Amazon, said the agency is

working with the community

to get input for waterfront de-

velopment, but is letting the

council and developers take

the lead.

Paula Kirby, Plaxall’s man-

aging director, said the family-

owned company remains

“committed to pursuing a vi-

sion that builds on Long Island

City’s history as a center of in-

novation and creativity.”

Your LIC, which was formed

by the developers TF Corner-

stone, Simon Baron Develop-

ment, and L&L MAG, will hold

its first public meeting on Nov.

21 at the Queensbridge

Houses. The meeting will fo-

cus on workforce training.

Councilman Jimmy Van

Bramer, one of the most vocal

local politicians who led the

fight against Amazon, said

community input is more cru-

cial than ever before. “If we’re

serious about something big,

something meaningful, it’s

gotta be done differently,” the

Democrat said.

An Amazon representative

declined to comment.

A year ago, a swath of

Queens waterfront was at the

center of one of the biggest

economic-development deals

in the nation, with Ama-

zon.com Inc. choosing it as

the location for a new campus.

Four months after the Long

Island City selection, Amazon

abandoned its plan in the

wake of backlash from some

local community leaders, ac-

tivists and elected officials.

Now, the property that

would have been the campus is

again in play to be developed,

along with adjacent sites. City

officials and developers are

beginning to consider the fu-

ture of the sites, with a public

meeting scheduled next week.

This time, Mayor Bill de

Blasio’s administration has

been less involved in the plan-

ning, in part out of fear of an-

other round of opposition

from community groups and

activists, according to people

familiar with the matter.

“Folks in city government

are skittish,” said Bishop Mitch-

ell G. Taylor, the CEO of the

nonprofit Urban Upbound, who

is working as a consultant with

Your LIC, a consortium of three

real-estate development firms

that control some of the sites.

A mayoral spokeswoman said

the city is working with the

community to understand their

vision for the area, but didn’t

say how closely the administra-

tion is involved in the planning.

Kathryn Wylde, the presi-

dent and CEO of Partnership

for New York City, a nonprofit

representing businesses, said

antidevelopment protests like

the ones against Amazon have

since spread across the city.

People are afraid of displace-

ment, rising rents and gentri-

fication, she said.

“Fear is the overwhelming

emotion in the development

conversation these days,” Ms.

Wylde said.

BYKATIEHONAN

Developers Revisit

Plans for Amazon

Campus Sites

NY