State Sends Foreclosure Notice To Hotel

Posted in Foreclosure, January 18th, 2008 |

The foreclosure is a legal process to bring justice to the sufferer. It has long been used as weapon to right a wrong. Illinois has had a long-standing dispute with a hotel in Springfield that has cost the taxpayer $30 million. On Tuesday the judge allowed the state to proceed with foreclosure against it.

Alexi Giannoulias the State Treasurer said that this meant that the state would take over the ownership of President Abraham Lincoln Hotel and Conference by spring this year and speedily put it up for public auction. The dispute had started in 1982 when the hotel took a loan of $15.5 million from the state. The hotel is owned by investors – one of them being William Cellini having Republican connections in Springfield. Since 1982 the hotel has been erratic in making repayments. The last one came forth more than 6 years ago in August 2002. This calculates to $30 million including principal with interest. The loss to the taxpayer amounts to $2,300 per day, comments Giannoulias.

As per court order by a Sangamon County judge foreclosure can be initiated against the main owners of the hotel. On Friday a date has been set for hearings to allow the state to include proceedings against the remaining owners also. The legal representative of the owners of the disputed hotel was not available for comments. If the owners fail to reverse the judgment then by spring the state will gain rights over the property.

To attract buyers the hotel would be freed from all liens and past court strictures. For nearly three decades this complicated legal dispute with political undertones has been in full swing. The hotel changed names many times. In 1985 it became Ramada Renaissance. It was during the days of Governor James R. Thompson in 1990 that the state allowed the loan to be restructured to forgive the hotel from making repayments if there was no profit to show. Payments would be made only when there were profits. Giannoulias contended that during 2006 and 2007 substantial profits had been recorded but no move had been made by the hotel towards repayment. It is a loss of face to the state to have allowed the hotel to get away with it for so many years. A hotel management committee has been appointed by the state to continue in charge during the tenure of the foreclosure proceedings.