DETROIT – For years, the Motor City Match program has aided new small businesses in Detroit with help getting federal funding, but now, that money has been cut off.
Federal officials are reviewing whether the funds were used in the right way.
Over the past four years, aspiring entrepreneurs have gotten a leg up through Motor City Match. It's one of Detroit Mayor Mike Duggan's favorite programs.
"We're giving you a chance to get your business started," Duggan said.
Motor City Match put big cash into businesses willing to open in poor neighborhoods.
But as the cash has flowed from the Federal Housing and Urban Development Community Block program to Detroit, the paperwork hasn't been up to par, according to officials.
Detroit Housing Director Arthur Jemison recently received an ominous 16-page HUD letter telling him the following:
"The records provided did not sufficiently evidence that the CDBG funds used for the Motor City Match program met a national objective and eligible activity.
"The city is advised to suspend the use of CDBG funds for the Motor City Match program until such time that there are sufficient records to evidence regulatory compliance."
"This program would be easier to document going forward if we used a combination of some CDBG and some general fund," Jemison said.
He's gone to work trying to negotiate a way to update old records to the liking of federal officials and move forward.
"Since that letter, we've met a couple of times and we're meeting again in a couple of weeks and we're getting close to a resolution," Jemison said.
He told Local 4 the city intends to continue the Motor City Match program. He said the HUD problems are surmountable and money will be available.
Officials from the HUD Chicago office told Local 4 they're working together to make sure Detroit residents get full benefits from the government funds.