When John Samples received $750,000 funneled through the Osage City City Council and the Kansas Department of Commerce in 2006 for his Kan Build modular housing business via a Community Development Block Grant (CDBG), it was considered a safe gamble. Samples was a successful businessman who had received accolades including Entrepreneur of the Year, had donated money to 4-H and other organizations, and had previously rescued Kan Build from going belly-up. However, the subsequent collapse of the housing market led to the company’s closing in 2011 and the loss of 108 jobs created by the grant. CDBG funds come from the federal government and then are funneled through the state to local governments which grants the monies to businesses in the form of low-interest loans. As MHProNews has learned from cjonline.com, Osage City is suing Samples for the return of $735,000, although reportedly he is in poor health and has fallen on hard times. The good news is the bank that financed the loan for Kan Build found a buyer for the building, which will put the property back on the tax rolls.

(Photo credit: merchantcircle.com–modular home under construction)