December 21, 2010
HUD APPROVES $20 MILLION LOAN GUARANTEES TO SAVE AND CREATE 422 JOBS IN PENNSYLVANIA
Funds will restructure debt of statewide employer 84 Lumber Company
PHILADELPHIA - The U.S. Department of Housing and Urban Development today announced that it is approving a $5 million loan guarantee to Washington County and a $15 million loan guarantee to the Commonwealth of Pennsylvania to restructure the debt of 84 Lumber Company. The funding is expected to enable the Company to create and retain at least 422 jobs over the next three years in the Commonwealth.
"The Section 108 Loan Guarantee Program is one of the most successful public investment tools that HUD offers to local governments," said HUD Secretary Shaun Donovan. "The program will be a boost to business revitalization
efforts for 84 Lumber Company which has 31 retail locations across the state and employs over 760 workers."
84 Lumber Company is headquartered in Washington County, Pennsylvania and is one of the nation's leading privately held building material and service suppliers to professional contractors and builders. Due to the economic crisis, the company has been forced to close stores, lay-off workers and sell real estate buildings. Restructuring the current debt service should eliminate the possibility of closing additional stores in Pennsylvania.
"This approval is great news, as it will help protect the jobs of hardworking Pennsylvanians across the
Commonwealth and provide much needed short-term assistance to one of our most respected businesses," said Governor Edward G. Rendell. "84 Lumber is based in Washington County and has a long history in Pennsylvania, and today's decision should help ensure that the company is a viable employer - and job-creator -- in the Commonwealth for years to come."
"We very much appreciate Secretary Donovan granting our request to help a great Pennsylvania company," he
HUD's Section 108 Loan Guarantee Assistance Program enables local governments to borrow money at reduced interest rates to promote economic development, stimulate job growth and improve public facilities. Such public investment is often needed to leverage private financing, to provide seed money or to simply boost confidence
private firms and individuals may need to invest in distressed areas.
"Today we join local communities in helping 84 Lumber to continue operating and increasing the area's tax base."
said HUD Regional Administrator Jane C. W. Vincent. "Together, we will restore economic vitality in surrounding neighborhoods and retain and create jobs for those who live there."
The Commonwealth of Pennsylvania will provide the $15 million in funding to Fayette County, Pennsylvania that will loan the funds to the real estate ownership entity of 84 Lumber Company. Washington County will add $5 million in Section 108 funding to the project. The company will make interest-only payments during the first two years and
the principle will be amortized over 15 years.
HUD is the nation's housing agency committed to sustaining homeownership; creating affordable housing opportunities for low-income Americans; and supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development ad enforces the nation's
fair housing laws. More information about HUD and its programs is available on the Internet at www.hud.gov and espanol.hud.gov.