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Cleveland City Council to loan up to $12 million to help get Shaker Square out of debt

The oldest shopping district in Ohio is getting some much-needed assistance.

CLEVELAND — The future of Shaker Square has become a little clearer after a vote by Cleveland City Council on Monday evening. 

Council members passed an emergency ordinance that agrees to loan millions of dollars to community development corporations to get the shopping center out of debt and find new owners.

For more than a year, the historic area has been in the hands of a court-appointed receiver after its original owner defaulted on loan payments. The process has left tenants and surrounding neighborhoods in limbo. 

Shaker Square is the oldest shopping district in Ohio and the second oldest in the nation. Its health is considered vital to Cleveland's southeast side, particularly the Buckeye-Woodland corridor, one of the city's poorest areas.

"As a city its our responsibility to stabilize neighborhoods and especially stabilize neighborhood anchors," says Cleveland City Council President Blaine Griffin.

The passed legislation provides a maximum of $12 million in economic development assistance loans to New Village Corporation, who has partnered with two non-profits – Cleveland Neighborhood Progress and Burten Bell Carr Development -- to acquire and stabilize Shaker Square.

According to a release from the city, $4 million is being raised from foundations and other organizations to pay for the deferred maintenance, including roof and window leaks. The organizations also plan to recruit new tenants in the small number of vacancies at the square.

Although the vote by council passed by a 16-0 count with one recusal, there has been opposition to the plan.

Some have argued that the city shouldn't risk tax money on a property that isn't worth that much. Add to that, new councilwoman Deborah Gray argued earlier on Monday during committee hearings that more investments should be made outside the square as well. 

"We need to consider the residents' taxpayer money that’s going to be spent," Gray said. "$12 million dollars to Shaker Square, and the rest of us around Shaker Square don’t live on Shaker Square."

Gray had been a holdout, supported the legislation. She still questions whether her entire ward (Ward 4) will reap the benefits. Many say the legislation can't wait, as any delay could jeopardize the future of the entire neighborhood.

Councilman Kerry McCormack decided to abstain from voting for the measure.

The move by council will allow the city to control the future of the square, making it involved in decision-making over the next several years until a new owner is identified. 

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