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LAKE GEORGE — The sweeping overhaul of Lake Champlain Lake George Regional Planning Board that began earlier this year resulted Thursday in the organization’s new leadership reinstating its main business loan fund.

The fund, which loans money to high-risk businesses, was suspended in June as a new chairman and director sought to sort out issues that had arisen under the director who left amid criticism weeks earlier. Questions had been raised about a number of loans, including loans to family members of Planning Board leadership, and about collection efforts and organizational issues.

With new policies, practices and staff in place, as well as an influx of cash from stepped-up collection efforts on existing loans, the board voted Thursday to begin taking applications from businesses in need of capital.

Board Chairman David O’Brien, the town supervisor from Hampton, said new board Director Beth Gilles has been able to get borrowers to “catch up” on their payments.

With increased collection efforts to get borrowers back on pay schedules, one fund that had a balance of about $50,000 over the summer has grown to $458,000, said Washington County Treasurer Al Nolette. Nolette has been serving as the organization’s bookkeeper since the spring leadership purge.

“That’s from collection efforts, staying on top of the loans,” he said.

The board also wrote off seven loans totaling $339,236, six of them from Warren County and one from Essex, as the companies have gone out of business, gone bankrupt or both, O’Brien said.

“We’ve gotten everything we can out of these. There’s no money left to collect,” O’Brien explained.

The board is also trying to sort out other open loans, such as to one business that has four loans. Eight other loans are listed as “doubtful” in light of the business operators’ financial situations.

“It’s been a challenge to make sense of the numbers, what happened and why it happened,” O’Brien said.

Seven additional loans have been “retired” as the borrowers paid them off, and the amount owed on the loans has dropped $300,000 to $2.8 million since the board shakeup.

Nolette said one of the changes to the loan process will involve ensuring that sufficient collateral is available. Collection on a number of older loans was hindered by “position” in multiple mortgages on property, or when vehicles were used as collateral.

O’Brien said the state Comptroller’s Office auditor who arrived at the Planning Board’s office in Lake George in the early summer continues to work on a review of the books. That audit began after a number of issues with the loan fund were brought to light by Queensbury resident Travis Whitehead and a Post-Star review earlier this year.

The Regional Planning Board, which assists communities and organizations with planning, grants and economic development, oversees its own regional development corporation that has multiple federally funded loan funds.

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reporter - crimes & courts, public safety and Warren County government

Don Lehman covers crime and Warren County government for The Post-Star. His work can be found on Twitter @PS_CrimeCourts and on

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