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To learn about how I came to work with the U.S. Small Business Administration’s (SBA) Disaster Loan Program, see My Start with SBA
Bob Raniewicz and Bill Roy (Loss Verifiers), Dennis Collins (Office Manager), Rich Olson (Loan Officer.)
In addition to the above professional staff, we also hired one local girl to handle the clerical duties. I’ve forgotten her name.
Ron at his desk and at the motel with his 1970 Chevelle Malibu.
I later learned, on this, my first disaster away from home, I was quite lucky.
Later disasters covered a much wider area and wiped out a lot of primary
homes. That resulted in huge crews
of utility workers and Red Cross and Salvation Army volunteers grabbing most of
the available motel rooms well before SBA folks would show up.
We Feds would always have to wait until a state’s governor made his own
disaster declaration. Then he’d
ask for Federal help. Only then, after an initial damage survey, would there be
a Presidential declaration and we disaster bums would jump to it.
Our entire crew found lodging at the Highway House Motel about 15 miles
south of Jerseyville in Godfrey, Illinois. Jersey County officials found space
for us in their courthouse.
Illinois River and the Mississippi River meet at Alton, Illinois (near St.
Louis) and our office in Jerseyville lay just a little north of that
intersection. The flooded
areas we covered lie on both banks of the Illinois River.
To the west of Jersey County lie a peninsula comprising
Calhoun County, Illinois and, thus, we also covered the east bank of the
Mississippi. The west bank of
the Mississippi was in a different SBA Region and was administered by a
different crew of disaster bums I never met.
“1) and 2) the landing of the Kempsville Ferry (which crosses the Illinois River) just north of Jerseyville. 3) near Alton, Illinois. Note the St Louis Gateway Arch in the mid-background. 4) The east bank of the Mississippi River on the west side of Calhoun County, Illinois.”
This disaster area was rather narrow, compared to the widespread damage from Hurricane Agnes in Wilkes-Barre. As such, very few primary homes were affected and damage was limited, for the most part, to summer “cabins” along the rivers.
The Jersey County courthouse. 2) A
destroyed mobile home “summer cabin.” 3) Our Lady of the Rivers statue that
sits in the Mississippi River.”
We ran into a problem granting loans almost as soon as we opened our office. On May 31, 1973 the US Senate cut off funding for the bombing in Cambodia and our loan funds appropriation was included in that bill. The advice from Springfield was that we’d continue to accept loan applications, we’d send our Loss Verifiers out, and then we’d process the loans up to the final signatures. That worked out and, within a week or so, our funding got approved and we sent several huge packages of loans up to Springfield to have the final documents drawn up.
problem arose concerning many of the summer “cabins” that had been damaged
along the rivers. A goodly number of
them were not “real estate”, per se, but rather large pieces of personal
property because they sat on land leased long-term from the US Army Corps Of
Engineers. The Corps controlled the
river banks for flood control purposes and, as such, the leases with the Corps
spelled out exactly what type of structures were allowed.
For the most part, these dwellings were built on stilts high above
anticipated flood levels. I’d
estimate that they were 15 feet above the ground.
Unfortunately, the rivers crested at about 20 feet in the Spring of 1973,
severely damaging many structures and even wiping others completely off their
stilts. Whereas actual landowners
who suffered losses could provide copies of their deeds to prove ownership, in
the case of the stilted cabins on rented land, we looked at the leases.
We found that, often, the actual original lease was dated to a former
owner decades ago and we had to follow the trail of subsequent assignments to
reach the current owner of the cabin. In
studying the leases, we found one very interesting item.
They contained a clause that, essentially, held the government harmless
for any damage, i.e., the cabin owners had “assumed the risk” and were
ineligible for Federal loan funds. Upon
first spotting that clause, we stopped all work on those loans.
We allowed applications to be filed but we didn’t even send the Loss
Verifiers out. Rather than issuing a denial letter, we merely sat back and
awaited further instructions from our higher-ups.
After about two weeks, the word came down.
These loans WERE being approved in SBA Region 8 on the other side of the
Mississippi, so we were to follow suit.
was faced with one problem that I absolutely could NOT solve.
Archeologists from the
Cahokia Mounds historical dig sites (see http://www.cahokiamounds.com/cahokia.html
came in to apply for funds. My theory in loan making (as well as elsewhere in life) has always been
to initially tell someone “NO”, leaving open the possibility that, later,
the answer may change to “Yes.”
That beats the heck out the reverse, i.e., having to explain to someone
that their hopes, initially high, had to be dashed.
In the Cahokia case, that theory served me well.
The Cahokia group were simply not a “business” having any
demonstrable repayment ability.
They were more properly classified as a non-profit agency that subsisted
on various state (and probably Federal) grants to do their work.
It took me more than an hour to explain that while, yes, they were likely
to get help, it would not be from our agency.
They would need to go back to the sources whence came their usual
Putnam Investors Fund which was forwarded to me by my Dad in Sweet Valley.”
“1) Madge, the clerk/typist. 2) Cattle near the flooded area.”
My second memory of that day trip is that I heard on the local radio station that I hadn’t heard since I was a child of 10 when my Dad worked in the anthracite mines of the Wyoming Valley. I heard the mine work schedule being broadcast !! Although southern Illinois is replete with bituminous coal (they even have a town named Carbondale) that is strip mined rather than deep mined like 1950’s anthracite, they still have 24/7 shifts. Workers listen to the broadcast to see if their shift is working or not.
The third memory of southern Illinois involves something quite silly. Did you ever notice the varying names on restroom doors depending on the type of establishment in which they’re located? Beyond the standard, “Women” and “Men”, you’re liable to find “Queens” and “Kings” in a place where folks play cards. I’ve also encountered “His” and “Hers” or even “John” and Jane” in other places. Well, what I saw in southern Illinois completely threw me for a loop! As I said, the area is quite big with bird hunters (and their dogs.) At the bar where I stopped for lunch, I had occasion to visit their facilities and was positively stunned to see “Pointers” and “Setters.” It took me the better part of a minute to decided which one I needed !!!
in Olive Branch, I made my first-ever visit (at age 27) to a Chinese restaurant.
The other disaster bums talked me into going to one in Cairo.
The food looked very strange and I ventured to try the sweet and sour
pork, but only after they swore to me that it contained no mushrooms.
up in Olive Branch, I returned north to Jerseyville.
That office, too, closed within a few days and our crew headed up to the
Springfield SBA District Office. Before
we left, though, the entire town threw us a farewell dinner to thank us for
helping them. The main course was catfish that had been caught in the Illinois
River and prepared by the head chef from Pere Marquette State Park. Having grown
up near the polluted Susquehanna River in Wilkes-Barre, I had been surprised to
find that the Illinois was pristine enough to support fishing.
two more weeks in Springfield, my job in Illinois was finished.
It was mid-September,1973, and the Disaster Branch Manager made a couple
of calls on my behalf. He found more
work for me up in Madison, Wisconsin. Having
spent the entire summer in Illinois and not knowing how long I’d be in
Wisconsin, I dreaded getting stuck there come wintertime.
I wasn’t looking forward to a drive from Madison to Sweet Valley on icy
roads, so I made a deal with the agency. I worked out the cost of driving up
there and, eventually, to Pennsylvania compared to driving home and then taking
a plane to Wisconsin and back. I
think it may have cost me a few un-reimbursable dollars but it was worth it to
me. I took a few days off, drove my
car back to Sweet Valley, and then flew to Madison.
work in Madison was unremarkable. There
was only one other disaster bum there, Bob Haukness from North Dakota, and we
finished some loans that had been hanging undone since the summer.
The area was quite scenic, with a large number of lakes and their state
capitol building was magnificent.
“1) Wisconsin state capitol building. 2) Unknown church steeple with lakes in the background. 3) Farmer’s market held on Saturdays mornings on a two-blocks-long public square near the capitol."
stayed in Madison for about two months and then, shortly before Thanksgiving, I
received a subpoena! My presence was
requested at the Federal courthouse in Scranton, Pennsylvania to testify as a
prosecution witness. The first of
the cases involved in the Lew Thomas scandal (see details at My Start with SBA
was coming to trial. I said goodbye
to Haukness and flew back home.
forgotten the name of the defendant but he was one of the tenants who’d
falsely claimed he suffered a loss at the Tattersall property during the Agnes
flood. SBA employee Lew Thomas had
helped him file the bogus loan application.
As the “Reconsideration Loan Officer” in the Wilkes-Barre disaster
office, I had approved his loan. This
was my first experience in a criminal trial and I managed to get myself
admonished by the bailiff twice before I even got on the stand.
I learned that, during the relative quiet of the voir dire proceeding,
one is NOT to chat with others in the audience and neither should one read a
was surprised to spot someone I knew.
The defense counsel was none other than Mario Cipriani, my old Business Law
professor at King’s College ! He
recognized me as “Spud!” (because I’d grown up on a potato farm)
in a low voice as I passed his defense table on my way to the witness
stand. I testified firmly how I had
made the defendant provide a notarized statement from his landlord.
One line of the disaster loan application was subject to two plausible
explanations but Cipriani kept cutting me off when I tried to tell the one least
flattering to his client. Frustrated,
I turned to the judge and exclaimed “You honor, I’m supposed to tell the
WHOLE truth and he isn’t letting me!” The
judge let me proceed but, in the end, it made no difference.
prosecution’s case was, I thought quite solid.
They had a mailman testify that, in all his years on that route, he had
never delivered mail to that person at that address.
Utility company employees also had no record of him being there and the
phone company had no listing for him, either.
The defense case hinged on one major point.
I had overlooked one important distinction in Tattersall’s notarized
statement. It said “I certify that
XX rented from me at YY” rather than “LIVED at YY.”
The defendant claimed that he never actually lived there and had only
RENTED space from Tattersall where he stored all the items he supposedly lost in
the flood. He supposedly lost a
color TV, a diamond ring, and assorted other absurdities—all were stored in an
unheated room on the second floor of a rundown (per testimony of the building
inspector) structure. The story
seemed quite preposterous but the jury, I guess, had some reasonable doubt and
they acquitted the defendant.
never talked to either the FBI or the US Attorney to learn how they’d solved
the case but it became apparent that they hadn’t yet convinced Lew Thomas to
come clean. Had they already
“turned” him, I’m sure he would have been compelled to testify that he had
helped the defendant file a false claim. I
don’t recall if Tattersall was ever tried for his part in the scheme but Lew
must have eventually ‘fessed up. He
was fined and placed on probation but never spent a day in jail.
spent Christmas and New Year’s with my Dad in Sweet Valley but I wasn’t out
of work for long. The phone call
came in early January and I found myself headed for Connecticut.
See my next story, entitled “Disaster Bum 1974.”
Ronald E. Hontz
33 Whitcraft Lane
cell phone (717) 309-1402