The holder of a $579,000 loan to the Tennessee Multicultural Chamber of Commerce is foreclosing on the two M.L. King Boulevard properties purchased with the money.
Legal notices in Saturday’s Times Free Press state that the minority Chamber has defaulted on the 2008 loan by the Chattanooga Community Development Financial Institution.
The notices state that the properties at 423 and 439 E. M.L. King will be sold at auction Oct. 3.
Multicultural Chamber officials could not be reached Saturday for comment. The Chamber’s telephone has been disconnected.
Last week, Multicultural Chamber board Chairman Walter Hitchcock said in a voicemail message to the Times Free Press that the Chamber board was scheduled to meet Sept. 20 to discuss reorganizing the nonprofit.
The Times Free Press raised questions in June about inconsistencies in the minority Chamber’s budget requests to Chattanooga and Hamilton County. Later, both governments axed their annual $75,000 contributions to the Chamber.
A subsequent review by City Auditor Stan Sewell revealed that the Chamber owed more than the total value of its assets.
The Chamber paid $500,000 from the CCDFI loan for the properties, which were appraised for taxes at just $211,000, as part of a plan to build a Business Solutions Center on M.L. King.
It bought three other parcels for the project using a $545,000 grant from the U.S. Department of Housing and Urban Development. Records show the Chamber paid $200,000 for the land and $106,400 for planning and development. The remaining $238,600 is unaccounted for, according to city records.
The business center was not built, and both HUD and FBI investigators have been asking questions about the loan and the grant.
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