A state agency completed a review of the low-interest loan given to Housatonic Wire owner Alex Budzinski and determined the money is being spent properly.
“All the state funds have been expended properly,” Jim Watson, spokesman for the state Department of Economic and Community Development, told the Valley Indy Friday afternoon.
At the same time, state officials ordered a contract voided that saw Budzinski receive $30,000 from the loan to act as a paid consultant.
“We did advise him that that needed to be voided,” Watson said.
Housatonic Wire, a former factory, was destroyed by fire Sept. 11, 2010. Budzinski secured a $200,000 loan from the state DECD to clean up the site.
The $30,000 contract — which was signed without the knowledge of the state and the source of a complaint by the Seymour First Selectman’s Office in September — was not handled correctly “administratively,” Watson said.
Any money paid out under that contract has been paid back and is being used directly for the cleanup, Watson said.
In addition, the state DECD gave Budzinski until January to finish the cleanup at Housatonic Wire.
Budzinski said Friday that work will resume shortly and residents will see progress at the site. He confirmed the news from the DECD but could not offer further comments.
The cleanup has limped along since the fire, much to the dismay of town officials. There hasn’t been progress there since July.
First Selectman Kurt Miller said in September the town had discovered Budzinski was being paid $30,000 by EnviroGuard, through the state loan, as a consultant.
EnviroGuard was hired by Budzinski to clean up the site.
Town officials alleged the agreement was secret, inappropriate and causing the cleanup to stall at Housatonic Wire once again, because EnviroGuard and Budzinski were bickering over payments.
Watson said the state reviewed all bank statements, contracts and other paperwork during its review.
“If we found any improprieties, we might have had a different series of remedies that would have needed to be taken on, but that was not the case,” Watson said.