A lone dissenting vote couldn't stop the first Grove City town center loan from being approved at the Nov. 16 city council meeting.

A lone dissenting vote couldn't stop the first Grove City town center loan from being approved at the Nov. 16 city council meeting.

Council member Greg Grinch voted against granting a $150,000 loan to MKOB Properties LLC. Voting for it were council members Ted Berry, Melissa Albright, Maria Klemack-McGraw and Steven Bennett.

Matt Yerkes, owner of the web software company Quicksquare Consulting, plans to use the money to remodel the Kenstar Pharmacy building, where he will move his company before the end of the year.

"I'm extremely excited about this because the whole reason for the (loan) was to attract economic development downtown," Berry said.

The loan program was established by a 3-2 vote of city council earlier this year. Grinch and council member Albright voted against establishing the loan program, which is administered by the Community Capital Development Corp. at the cost of $45,000 this year.

Grinch said his vote against giving out the loan wasn't personal.

He said he believes the loan program might be illegal, an idea that city law director Stephen Smith disputed.

"I believe it's a possible violation of Sec. VI, Article VIII of the state constitution," Grinch said, "which prohibits (municipalities) from raising money or loaning its credit to any private company, corporation or association.

"I also believe that public funds should be used for public purposes, which are to promote the health, safety and welfare of our citizens, and I don't believe this does that," he said.

Other cities, including Columbus and Cleveland, have similar loan programs, Berry said.

Smith said the portion of the constitution Grinch cited doesn't apply.

"We believe it is legal, In fact, we even got a second opinion from the city bond counsel and we believe that the city does have the ability to use its income tax revenue in this manner," Smith said.

"We certainly wouldn't advise the city to do anything that we thought was questionable. I believe the city is complying with the law in every respect."

Even if it's not illegal, Grinch said he's opposed to it on principle.

"I believe this is money that belongs to the city and the city should not be a bank. Otherwise, they would call us Grove City Municipal bank," he said.

In addition, Grinch pointed out that the legislation establishing the loan program called for five- to 15-year loans. The loan approved last week was a 20-year loan.

"I feel like it's a really loose set-up," Grinch said.

Berry said that Quicksquare is exactly the type of company for which the loan program was designed.

"The average salary is about $50,000, so there's income tax there, and (Yerkes) is renovating an existing building, which is wonderful."