A decade ago, the city loaned the Steamtown Mall Partners, headed by department store chief Al Boscov, $3 million. There were signs then that the mall faced steep challenges, but few forecast foreclosure. Now, the mall is barely treading water and city taxpayers, already drowning in debt, will have to pay the $1.8 million balance of the unpaid loan.
As Jim Lockwood reports in today’s Times-Tribune, the loan was financed with federal block grants, which local officials too often treat as free money. It doesn’t come from local taxes, so it seems easier to spend. The situation also points to the risk in using public money to support private business.
Supporters can argue that keeping the mall afloat is in the city’s best interest, but no one can say it’s fair for the public to be saddled with private debt. The city has no choice but to pay, but it should do whatever it must to make Mr. Boscov honor his obligation.