Denver Direct: Seedco Gets Schooled

Monday, December 1, 2008

Seedco Gets Schooled

Seedco is back before City Council this evening, asking for a continuation ($3,000,000) of the Federal money Denver turns over to it for distribution as small business loans. As I understand it, Seedco is a not-for-profit out of New York which claims to “leverage” the money we give them. I think they are misusing that term and would advise that, in this over-leveraged financial environment, they use another word. What they actually do is “attract” additional private loans based on the credibility they get from receiving the Denver money.

Apparently they haven’t been doing a very good job at their Denver office. Denver’s Office of Economic Development has been keeping track, and published a Monitoring report last week. There are many problems listed, but I’ll quote just one that seemed the most egregious to me. They don’t know how to create a filing system:

Condition: Overall, the loan files appear to be disorganized, with no order or consistency. There are many files with a variety of documents inconsistently filed. Therefore, it is understandable that some documents are present in some files but not in others. Technical Asisstance offered:

The Contract Administrator will provide the agency with a sample file and template to allow the agency to set up their files in a manner consistent with the way in which the City and County of Denver sets up their files in accordance with the direction of our HUD monitor.

Recommendation: SEEDCO should purchase legal sized files with 6-8 compartments in order to facillitate file organiation to ensure compliance. The Contract Administrator will put together a sample file and provide technical assistance identifying the preferred method of organizing a file in order to assist SEEDCO in organizing their documents to facillitate a more comprehensive
approach to establishing support documentation.

All files should be reorganized in the prescribed method and missing documentation should be inserted by November 30, 2008.

City Council voted last week to proceed, even though the Monitoring report was not yet available, and I’m guessing that Council will approve the continuation (another $3,000,000) tonight despite the seemingly incompetent manner in which the organization has been run.