La Mujer Obrera Defaults On City Loan

By ABC-7 Reporter Maria Garcia

El Paso, Texas – La Mujer Obrera is now in default with the City of El Paso for not paying a $250,000 interest-free loan by January 1.

The City loaned the non-profit the money last June, when La Mujer said they would have to close down the newly-opened mercado without the funds, and leave more than 100 people without a job.

La Mujer Obrera assured City Representatives they were expecting federal grants in the near future and would pay the money back by the end of 2009.

That didn’t happen.

If the organization does not pay the money in full by January 10, then the loan will begin accruing 6-percent annual interest.

That’s $1,250 per month and $15,000 total.

If La Mujer Obrera doesn’t pay the loan at all, then the City has the right to collect all equipment inside the mercado as collateral.

That includes all cooking equipment and furniture.

Cindy Arnold, the Director of Mercado Mayapan says it won’t have to come to that because they’re expecting to soon receive federal funds that have been stuck in red tape for months.

She says La Mujer Obrera will pay the loan in full by the end of this year, possibly within the first 6 months.

But City Representative Steve Ortega is weary.

“I’m sure that they’re going to say money is coming it just hasn’t come in yet, I don’t know what to believe”, he said.

Ortega wants Mercado Mayapan to stay in business, but also says La Mujer Obrera has to learn how to stay sustainable without government help – “Everyone wants that organization to succeed, that’s why we made the loan and so it is discouraging that some representations were made that have not come to fruition.”

This isn’t the first time La Mujer Obrera has asked Council for funds.

In 2007, they asked for $2million to open Mercado Mayapan.

Also, in September of last year, they requested $400,000 from the city in empowerment zone money to train their workers.

Both times the city denied the requests.

City Representative Eddie Holguin even said he was hesitant to give money to an organization that loses money to train workers on entrepreneurship.

Arnold says La Mujer Obrera has had a solid business plan for the last 28 years, staying open at times, on a volunteer basis.

She says they have helped low-income, Spanish-speaking women develop employment skills and learn business planning.