Mass. Governor Deval Patrick holds federal loan program up to public view

[Ian David]

BOSTON -- Each year Massachusetts doles out hundreds of millions of dollars in federal low-interest loans to quasi-public development and education financing agencies in a selection process that takes place largely out of public view.

Now the Patrick administration says it wants to open up the process to public scrutiny and is holding what it says is the first-ever public hearing on where the money goes, and how it is spent.

"It's a huge economic engine that the state is investing in that hasn't gotten a lot of attention," Administration and Finance Secretary Leslie Kirwan said in a recent interview with the Associated Press.

It's Kirwan's job to decide how to divvy up the federal loan dollars -- this year totaling $547 million.

The money goes to three quasi-public state agencies -- the Massachusetts Housing Finance Agency, the Massachusetts Development Finance Agency, and the Massachusetts Educational Financing Authority -- which turn around and make the loans available to private developers and individuals.

Kirwan said the distribution of the funds has historically been done largely out of the public eye. She said the decision to hold a public hearing is in keeping with Gov. Deval Patrick's pledge to encourage more participation by citizens in government. She emphasized that there was no suggestion that funds were missused.

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