PARK NATIONAL BANK’S LEGACY
Earlier this year, Austin’s Kidz Express renegotiated the loan on its Laramie facility with U.S. Bank.
That process, however, did not go as smoothly as the organization would have hoped. The loan was originally taken out five years earlier through Park National Bank of Oak Park. After U.S. Bank took over that branch in November 2009, Kidz Express needed to adjust its loan terms.
“One advantage we did have going into talks with U.S. Bank was that one of our board of directors, Duane Ehresman, already had a good working relationship with the bank,” said Kidz Express founder Warren King. “That made a huge difference in allowing us to swiftly come to a payment level that all sides could agree on.”
While the payment arrangements were higher than those offered by Park National, Warren King said that the deal made was fair.
“It does seem as though U.S. Bank is trying to keep the commitment to the community that Park National had made to the best of its abilities,” King said. “The new loan agreement is not perfect, but it is equitable.”
Doug Low, Kidz Express’ executive director, however, has a slightly different take on the negotiations.
“There really was no consulting us at all; they just sent us their terms and that was that,” he said, adding that U.S. Bank would send three different versions of the new terms of their loan.
One arrangement, according to Low, would have forced the organization to pay $5,000 monthly on a 15-year, 2-percent interest rate loan.
“[$5,000] would have been a difficult rate because of our operating budget,” he said. “We serve 150 kids a month here, on average about 100 kids a week. Our operating budget is $100,000 annually. That amount would have greatly curtailed what we would have been able to do.”
Eventually, U.S. Bank and Kidz Expressed settled on a loan agreement, the terms of which Low and King preferred not to discuss in detail. Located at 342 S. Laramie, the nonprofit youth organization provides tutoring, dance and mentoring, among other services, to kids.
It also offers GED classes and job training to youth aged five to 18. Kidz is one of the few outreach programs that includes nutrition as part of its curriculum, the group’s leaders noted, and it offers children healthy meals of fruits and vegetables during their gatherings. More programming is offered in the summer with kids out of school.
“There are not many programs in Chicago that are free and offer as many different types of programs that we do” Low said. “Many summer programs offer six weeks of activities at a $300 per child. For many parents, that’s just not a feasible price to pay on a limited budget in this current economy.”
Nevertheless, Kidz Express is still facing questions surrounding its financial future, namely methods to increase its funding and offering more programs during the school year. Also, the group eventually wants to move into a larger facility. With these means in mind, Kidz Express is working with Springboard Foundation, a Chicago-based consulting firm, to come up with ways to increasing funding.
“In the next three years we would like to expand our operations, so that we are looking at a $400,000 to $500,000 budget and can serve 200 to 250 children.”