Private lender considers foreclosure on Multicultural Chamber loans

A review of the Tennessee Mulicultural Chamber of Commerce's records raised several concerns, prompting the agency's lender and at least one board member to distance themselves from the beleaguered organization.

On Wednesday, David Johnson, head of the Chattanooga Community Development Financial Institution that loaned the agency $500,000, called a news conference to address his organization's role with the chamber.

“We are not the story,” Johnson said, after he explained how the FBI contacted him about the loans his organization made to the Multicultural Chamber.

“I asked two questions,” he said. “I asked, 'Is the CCDFI the target of an FBI investigation?' and “Is the CCDFI the subject of an FBI investigation?'”

Johnson said the federal agency assured him the CCDFI is not being investigated. To questions about an investigation of the multicultural chamber, Johnson said he only asked about his agency. Ed Galloway, with the Chattanooga FBI office, said he could not comment on whether the Multicultural Chamber is under investigation.

Johnson said the CCDFI will “get the ball rolling,” in the next few days to determine what action it will take toward the chamber's defaulting on two separate loans of close to $500,000 together. The options include foreclosure; Johnson declined to say what they will do.

Board member resigns

Earlier this week board member Thomas Loafman resigned after his recommendations were rejected by Taylor and Gilchrist. Loafman, a VW executive, said he supported the chamber's mission but that he could not support the chamber's response to requests for information about how the organization has functioned since 2008.

Loafman recommended that executive director Sherrie Gilchrist be put on temporary suspension while an investigation was conducted, and that the chamber come up with a sustainable plan to submit to the city before asking for any funding.

"Chattanooga needs an advocate of the small and minority business owners ... helping to promote and support those entrepreneurs," Loafman said in his resignation letter. The board's decision to reject his recommendations further jeopardizes the future of the agency, he said.

On Wednesday, John Taylor, former city councilman and prominent businessman, staunchly defended the TMCC and Gilchrist. 

"We are not asking for money," Taylor told the Hamilton County Commission. "It's about character and it's about integrity."

He said he refused to fire Gilchrist because no one could prove to him she had done anything wrong. He would not address Loafman's suggestion to suspend her.

Gilchrist said she had not heard from HUD, which awarded the agency a $500,000 grant for a 2008 project that has yet to materialize, nor did she or Taylor know of a possible FBI investigation. She questioned who contacted the federal housing agency, suggesting that a smear campaign is being run on the Multicultural Chamber.

“I hate that this is playing out in the media,” she said, after the county commission meeting Wednesday. “We have nothing to hide.”

Gilchrist blamed media coverage for prompting the records review, requested by Chattanooga Mayor Ron Littlefield, and for the doubts voiced by some city and county officials.

But both panels had cut the Multicultural Chamber from their budgets long before the review was requested, according to records of the budget process.

Mayoral spokesman Richard Beeland and county Commissioner Tim Boyd both said the decision to cut the chamber came before the review was published.

“In (my) mind, it was the bang for the buck, I didn't feel like they were doing their job and I expressed that on two occasions during commission meetings,” Boyd said. “I decided this based on an experience I had with them that made me feel like they were not doing the job they were supposed to be doing.”

The number of people accompanying Taylor and Gilchrist dropped between the group's first public appearance last week at the City Council meeting and Wednesday's commission meeting, with only Taylor and Gilchrist present.

Businessman Gerald Mason referred a request for a comment about attending the commission meeting to Taylor, while efforts to reach former city Councilman Yusef Hakeem, who was present at the last City Council meeting, were unsuccessful. Jerry Hanner, a local general contractor, also at the last City Council meeting, said he still supports the agency.

Chattanooga Chamber emails members

Earlier Wednesday, the Chattanooga Area Chamber of Commerce sent an email to members to address the confusion between its organization and the Multicultural Chamber.

“It was not intended as press release, it was intended as a communication to our members,” J.Ed Marston, vice president of marketing and communications for the Chattanooga Chamber, said. “We decided to do it because we were getting a lot of questions from our members and people associated with our members who were confused. We call ourselves 'the chamber,' and they call themselves 'the chamber.' We were just trying to clarify and inform.”