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Borrowers seem most creative when devising reasons not to pay
SOUTH SIDE -- When the city loaned Emerald Art Glass Co. $100,000 in 1988, the promise was that the operation would thrive, create jobs and repay the cash so that another company could have the same opportunity.
Today, the promise is broken and the city is in court trying to recoup the funds for its economic development programs.
Emerald Art Glass is not alone. It is just one of many companies that have not lived up to the vision of economic development through public funding.
The Urban Redevelopment Authority of Pittsburgh spends a significant amount of time chasing defaulting borrowers, often through litigation.
Consider the statistics:
* Of the 342 URA loans approved since 1986, 42 of them, more than 12 percent, are either in default or have been written off as bad debt.
* The Authority now has 227 active loans, of which 18 are held by companies that are in default (overdue by more than 90 days). Those 18 firms account for $721,726 of the URA's $11.6 million portfolio.
* In percentage terms, about 8 percent of the active borrowers in the URA's portfolio are in default, and another 17 percent of its debtors are …