The Manchester Development Corporation (MDC) operates largely behind the scenes and with little public review, though it loans public money, mostly to private interests. Its oversight is surprisingly lax.
With $1 million in seed money from the sale of city-owned land at the airport back in 1985, the MDC invests in economic development ventures. There have been some high-profile projects, such as the redevelopment of the Pandora Mill building, the Chase Block and UNH-Manchester. (How much credit MDC deserves for these projects is for another debate.)
MDC loans are supposed to be approved by the Board of Mayor and Aldermen before they are made. That requirement is in the MDC’s bylaws. But the group does not appear to have been abiding by it. Aldermen were surprised to learn last week that an MDC loan to an existing Elm Street restaurant — XO on Elm — had already been approved. The loan had been approved by the mayor’s office, where the city office that oversees the MDC, the city economic development office, had been relocated earlier this year.
The loan to XO was unusual in that it went to an existing business. The MDC was intended to develop new business activity. It is unclear whether its issuance prior to aldermanic approval also was unusual.
The idea that the city can and should stimulate economic development by lending public money to entrepreneurs and developers is questionable at best. If it is to do so, that lending plainly needs public oversight. Aldermen need to review the MDC’s records to learn whether it has been lending without the required approval. They then need to see that the organization’s practices are more transparent. Its minutes and agendas need to be posted online (they are not now), its board members listed (they are not now), its meetings posted and open to the public, and its proposed loans reviewed by the city’s elected officials.