C.R. replaces business flood recovery loan administrator

The City of Cedar Rapids has replaced its grant administrator in the final stretch of the JumpStart business flood recovery program.

Transitions Made Better, the Cedar Rapids company of Theresa Bornbach, will be replaced by ProSource Technologies, the Minneapolis-based company that has been administering the city's voluntary property acquisition program. An agreement to conclude Transition Made Better's contract with the city will be enter into a new contract with ProSource is on the Cedar Rapids City Council's April 12 agenda.

Two JumpStart Business Recovery programs used federal Department of Housing and Urban Development funds to provide working capital grants to businesses hit by the record June 2008 floods. The first phase of the program provided $19 million. The second phase of the program has distributed nearly $20 million to businesses, according to Jennifer Pratt of the Cedar Rapids Department of Community Development. She did not know the value of funds already applied for but not yet distributed.

The city simply said the transfer was mutually agreed on to allow Bornbach to concentrate on her other business endeavors, which include Corridor CoWorks and the Business Exchange Center.

Although an audit of the program by HUD's Inspector General found problems in the documentation requirements of the JumpStart program last year, Pratt said the contract transfer was unrelated to the audit issues, which have since been resolved between HUD and the State of Iowa.

The programs were developed on the fly and and took almost two years to distribute about $50 million in funds, partly due to changing interpretations of federal program requirements on such matters as loan documentation.

Doug Schumacher, a founding member of Cedar Rapids Small Business Recovery, said Bornbach was “almost singlehandedly responsible for bringing a lot of these funds into town.” He said without Bornbach's ability to develop the programs and understand the process, the businesses may not have received the funds.

“This community owes her a great debt,” Schumacher said.

The city, in a prepared statement, also expressed gratitude for Bornbach's work, and said the city “is dedicated to continuing that commitment to recovery.”

Bornbach said she plans to continue as an advocate for business flood recovery, but otherwise declined comment on the transfer.

Twenty five file cabinets of documents have been transferred to ProSource. City officials said the company has trained staff and systems to “ensure funds will continue to flow to all participating businesses.”

ProSource, 417 First Ave. SE, can be reached at 319-730-5660.