By SooToday.com Staff
SooToday.com
Sunday, November 16, 2008

Boniferro Mill Works is still having trouble paying off the $60,000 interest-free loan it got from the City in April, 2007.

In May of this year, Jim Boniferro, the company's president and chief executive officer, got a six-month extension, agreeing to pay $1,500 a month with a balance of $51,000 due on November 30.

Tomorrow night, Sault Ste. Marie City Council will be asked to grant Boniferro six more months to pay off the loan, with $1,500 payments continuing each month and a balance due by May 30, 2009.

The following report was prepared by Bruce Strapp, chief executive officer of the Sault Ste. Marie Economic Development Corporation:

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Boniferro Mill Works (BMW) loan extension

On November 3, 2008, the Sault Ste. Marie Economic Development Corporation (SSMEDC) board of directors reviewed a letter from Mr. Boniferro, owner of Boniferro Mill Works (BMW) requesting an extension to his current loan of $60,000 for an additional six months (see attached BMW letter).

The SSMEDC board of directors approved Mr. Boniferro's request and is asking City Council for its approval.

This process started back on April 30, 2007 when City Council passed a resolution to grant Mr. Boniferro a $60,000 interest-free loan from the economic diversification fund for one year.

The reason for this loan was due to the fact that CN advised BMW that the rail line spur into their facility was in need of major repair and that shipments would be discontinued until repairs were complete.

The loan was granted and the rail spur repairs were complete and was operational within five weeks of this decision.

This rail spur repair supported several companies that were using this service provided by BMW.

BMW approached the SSMEDC board in April 2008 and asked for an extension of an additional six months which was granted and approved by City Council based upon SSMEDC board support.

At that point BMW started making $1,500 payments/ month.

As of November 30, 2008 BMW will have paid $9,000 leaving $51,000 outstanding on the $60,000 loan.

Due to the economic times which are worse today than six months ago, BMW is requesting an additional five months extension and would continue to make $1,500/ month payments to the SSMEDC.

This extension would take us to May 30, 2009 where the amount outstanding at that point in time would be $42,000.

Mr. Boniferro has also indicated that litigation with the Ontario Government was brought to the Ontario Court of Appeals on September 2, 2008 and a ruling has not been rendered as of yet

The promissory note dated May 23, 2007 would continue on file securing the registered equipment in the name of the Sault Ste. Marie Economic Development Corporation.

SSMEDC board of directors recommendation:

Whereas the SSMEDC board of directors approved Mr. Boniferro's request, the SSMEDC board of directors is requesting City Council to grant approval based on the following:

1 - That due to economic conditions in the marketplace today, an additional six-month extension to Boniferro Mill Works $60,000 interest-free loan be granted;

2 - Boniferro Mill Works continue to pay $1,500/ month which the balance as of November 30, 2008 would be $51,000 and the additional six-month extension would bring the balance down to $42,000 to be repaid by May 30, 2009;

3 - Continue to use the promissory note dated May 23, 2007 as security to the loan.

SSMEDC board of directors appreciates the consideration and support of the mayor and City Council.

Open for business

D. Bruce Strapp
CEO, SSMEDC

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Tell 'em what you think

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Councillor Manzo cannot be reached by e-mail, but you can phone or fax him at 945-9971.