Mahogany's restaurant at The Banks promises to catch up on its financial obligations and keep its doors open through a cold winter that has depressed businesses. The small business received a $300,000 loan and an almost $700,000 grant from the city of Cincinnati to help get it off the ground in 2012. Now, the owner vows that her small business debt will not force the soul food restaurant to go under.
At the time that Cincinnati officials approved the loan and grant, Rogers was behind on her personal property taxes. Now, the business has missed payments on the loan from the city and is about $22,000 in arrears on its workers' compensation obligations and sales tax yet to be paid.
The restaurant has lots of company. Across Ohio, around 43,000 businesses missed their last workers' compensation payment deadline, a number that reflects 15 percent of all businesses incorporated in the state. Some of those companies have since found the cash flow to catch up; the Ohio attorney general will pursue collection on the businesses that have not. Mahogany's is one small business on the list for legal action to collect the debt.
For now, the city is standing behind the small business and has proved to be a flexible creditor. After business debt negotiations, they have reportedly worked out a revised repayment schedule.
Despite the restaurant's debt load, the small business owner isn't indulging in self-pity. "There are hundreds of businesses in the city that have similar problems or worse," she said. "They file bankruptcy, they close."
In many cases, small business owners are able to file bankruptcy in order to resolve debts and remain open. Given the number of Ohio businesses struggling to make ends meet and deal with overwhelming debt, many business owners might be wise to seek advice from an attorney experienced in business bankruptcy and debt relief.
Source: Cincinnati.com, "Mahogany's behind on city loan, payments to state," Sharon Coolidge, Feb. 6, 2014