Zambito says he will repay BDC loan after laundry equipment sells for only $3,500
Chad Zambito, an appointed Town of Batavia board member and candidate for the GOP nomination for that seat, expected the assets of his former laundromat to sell for somewhere close to $30,000.
The actual highest bid on Tuesday, in an auction conducted by the Bank of Castile, was $3,500.
That's enough to cover Zambito's debt to the bank, but he still owes more than $14,000 to the Batavia Development Corporation, which provided Zambito with a low-interest loan in 2010 to finance upgrades to the laundromat.
This morning, Zambito issued the following statement:
I continue to work towards resolving the issues related to the closing of my business and intend to meet with the BDC board to resolve any outstanding issues. I have started the Chapter 13 process which in the short term will provide me 60-90 days to get my finances in order. If I complete the process, the result would be a court ordered and monitored five-year repayment plan.
Grammy's Laundry closed earlier this year and Zambito said much of the business's difficulties stemmed from a plumbing problem in the mall where Grammy's was located. He said the business never recovered from the set back.
A former laundromat owner who observed Tuesday's auction said just one of the high capacity dryers at Grammy's retails new for about $3,500. There was some 40 or so washers and dryers, some in apparent disrepair, in the facility. The buyer is an out-of-county laundry owner who reportedly plans to remove all the machines and take them to another of his laundromats.
Zambito's GOP primary opponent is John Gerace, who held the office for nearly a decade before resigning in April after a Town of Batavia Fire Department awards and installation dinner where Gerace reportedly had some sort of confrontation with Supervisor Greg Post.
Shouldn't the BDC be paid first before the bank..Should there be more oversight at the BDC..How many more owe money that can't pay to the BDC...The tax payer should come first before the bank...
Who cares as long as it's paid back what order it goes in. How about he didn't say, "I'm filing chapter 11 and screw all of you!", which he very well could have.
The sad thing about this is how it is being aired. It was brought to the public because Gerace wanted to get "even". Businesses fail all of the time, debt gets restructured and repaid. The only reason why this is news is because a local candidate wants to take the focus off himself.
I think Mr Gerace's handling of this is frankly classless, and I hope he losses. Seems to me we have enough classless politicians already, and most of my friends in the town agree.
LOL I agree completely on that sentiment Phil another town resident, Mr. Zeagler seems to be holding Mr. Gerace's feet to the fire on the way he handles himself as well. egardless of that my simple take is this, whatever Gerace resigned for, valid or not, Gerace seemed to impulsively react to whatever it was he did and felt guilty enough about it that he even thought he should step down, then he changes his mind and decides we should trust him enough to put him back. That seems pretty unstable and or out there. If we were to elcet him back what are we gonna do if he does another "something and decides to resign again, or worse decides to stay and drags the whole town through a terrible scandal. Nope better off remaining where he is reaping the benefits of his actions.
We constantly say we want people in our representatives spots who have values, this situation with Mr. Gerace's indecision reminds me of a quote attributed to the late Roy Disney which seems to really make me think on this...
"It's not hard to make decisions when you know what your values are."
That speaks volumes for not only the Gerace situation but for our Gov't politics in general nowadays.
Phil, you pretty much hit a home run with that statement. I couldn't agree more
Some businesses make it and some don’t. Just because his business failed isn’t any reason to hang Zambito out to dry. I’m pretty sure he has every intention to pay back his debts. I don’t think there is a person on earth who has failed more times than Donald Trump and he is considered a pretty successful guy.
Give him a break.
Phil is right. This whole thing started becase Gerace got drunk in public.And then someone pointed out he owed some taxes. To even up, Gerace makes public the other guys business problem. Gerace does not deserve to be reelected.
I didn't intend my comment to be about Gerace..Its more about how BDC hands outs loans ...The taxpayer should always be paid back first...How many others are behind in loans they get from the BDC..Was Mr.Zambito a credit risk to begin with and should he of been loaned that amount of money from the BDC in the first place.......We are talking about 14,000 tax payer dollars...
He wasn't delinquent, Mark. He paid through July and was hoping to raise enough cash from the auction. Now he will pay back the loan on his own. I don't rally understand your concern. He only raised $3500 which wouldn't even put a dent in what was owned, so he elected to pay the higher interest bank loan, and focus his personal assets on the lower interest one. That's basic finance, you get rid of higher interest payment debt first.
His business failed. He is trying to make good. As a tax payer and someone who runs and understands business, I'm fine. If he wasn't doing that I would have an issue, but that doesn't seem to be the case.
Phil my concern is how they hand out loans at BDC ..My concern is how tax dollars are spent..Should he of even been given the loan in the first place..$3500 would put a dent in his debt to the BDC..A 25%dent..He owes Aug and Sept so that is delinquent....How many other loans to the BDC are behind or in default....This to me is more about who the BDC loans tax payer dollars too...Do the people they loan money to have a good credit history..
Typically in loans, creditors are put in a line. The creditor first in line gets paid first.
I can't say for sure, but my guess is Bank of Castile made the first loan, so it gets paid off first.
I don't believe Chad, nor the BDC, had any say in the matter.