Chicago congressman ordered to pay $1.1 million on loan for church intended to rebuild Englewood
What was intended as a rebirth effort for a neighborhood in a U.S. representative's district has turned into a court battle over an unpaid loan.
According to a Better Government Association (BGA) article published Nov. 27, U.S. Rep. Bobby Rush (D-Chicago) is under a court order to pay about $1.1 million toward a loan that had been given to his church to kick-start development in Englewood.
The loan was made about 12 years ago to Beloved Community Church of God in Christ, where Rush is a pastor. The church was going to buy the former Our Redeemer Lutheran Church building at 6430 S. Harvard Ave. and spur development, according to the BGA.
“At the time, Rush said he planned to make the church the cornerstone of his effort to rebuild Englewood, the long-struggling South Side neighborhood that is part of his First Congressional district,” the article said. “He formed a community development corporation, Rebirth of Englewood, and discussed building affordable homes and a technology center in the neighborhood, as well as providing needed social services and cultural arts programs.”
The church used a loan for $550,000 from New City Bank toward the purchase price of $800,000 for the building. Eight church members, including Rush, were cosigners on the loan.
Telecommunications company SBC, which is now AT&T, gave the nonprofit $1 million out of its charitable division toward a center to be an incubator for small businesses and have computer training. Taxpayer funds totaling $32,630 went to the nonprofit as well for building-rehabilitation purposes, the BGA reported.
The technology center has never been built. Rush did not have records of where the money went, telling the BGA in 2013 that he was not involved in the daily work and that the SBC grant was for programs, not a structure.
Over the years, Rush had used money from his campaign to help fund the church. The BGA reported that the congressman gave more than $200,000 from his campaign to the church. The campaign reported the money as donations.
The church had ceased making loan payments of $3,562 per month in November 2011, the BGA said court records reported.
Rush will be liable for the judgment, per the loan terms and court actions. Berton N. Ring, Rush's attorney, told the BGA that repaying the debt will be challenging for Rush.
A court date had been set for late November for the plaintiffs' lawyers to reveal Rush's assets to establish the amount of debt he would be able to pay.
The total a Cook County judge ordered Rush to repay is $542,000 in principle that has not been paid back, as well as $441,000 in interest and $48,000 toward the plaintiff's attorney fees.
The congressman has not personally benefited from the whole arrangement, his attorney told the BGA.
“Congressman Rush decided to help out the church and sign the note,” Ring said. “He did not get any money. He got no financial benefit from it at all. He was just helping out the church. He was just too nice of a guy. It was kind of unfortunate.”