Newly released emails from the state Department of Economic and Community Development reveal that the agency’s deputy commissioner directly intervened to help Hybrid Insurance CEO Earl O’Garro, Jr. receive a second state loan, despite an agency project manager indicating O’Garro was not eligible for additional Small Business Express funding.
UPDATE: DECD Deputy Commissioner Ron Angelo defended his actions today and said he plays “an active part” in all loan proposals before the agency. After O’Garro’s request for a second Small Business Express loan was denied, O’Garro was directed to apply for a different funding source from the state, “which is completely proper,” Angelo said.
“I didn’t do anything for Hybrid any differently,” he told the Courant. [Click here for our full story.]
Th project manager on the Hybrid loans, Barbara Fernandez, informed O’Garro on Feb. 1, 2013, that he could not apply again for the Small Business Express program “until your current loan and grant are audited and closed out.”
A few hours later, Christopher Cloud, a lobbyist for Hybrid, forwarded Fernandez’s response to DECD Deputy Commissioner Ron Angelo and wrote that O’Garro had “filled out the express application as you suggested just to get the process started. His hope is to receive a larger loan this time to grow more jobs at Hybrid. I am sure Barbara’s response is technically accurate, however, we hope that we can discuss this application with you directly and work through whatever issues there may be to move this process forward.”
“I’ll take care of it,” Angelo replied to Cloud and his lobbying partner, Tony Camilliere of the firm Camilliere, Cloud and Kennedy.
Cloud replied to Angelo, “Thanks my friend! Have a great weekend!”
In a separate email Feb. 1, Angelo included an initial thread of Hybrid email messages and wrote to a DECD employee, “Move this MAA funding outside of EXP.” MAA refers to the state’s Economic and Manufacturing Assistance Act initiative that provides low-interest loans to small businesses showing “strong economic development potential,” according to a DECD description.
On Feb. 20, Angelo emailed O’Garro and cc’d Camilliere and Angelo’s office assistant, asking to speak with O’Garro about his request for a second DECD loan.
Emails in March also indicate that Angelo wanted a meeting to discuss Hybrid.
As we reported last week, the original emails released to the Courant showed that Angelo instructed DECD employees on Feb. 21, 2013, to “get the ball rolling” on a $3.5 million loan request by O’Garro, despite O’Garro’s late payments on the initial $126,000 DECD loan and grant package he received in March 2012 to relocate Hybrid to a Hartford building owned by city Treasurer Adam Cloud and his family, including twin brother Christopher Cloud.
O’Garro’s request for $3.5 million was eventually amended, and he instead received state approval for a second, $500,000 loan last summer to expand his company — just as it was about to collapse. O’Garro, who is now the target of a federal probe, obtained the first $250,000 installment on that state loan in early August and was in default for non-payment by late October. He never received the second $250,000 installment.
O’Garro owes $106,000 on the first state loan and about $265,000 on the second, according to state default notices.
The Courant received documents related to O’Garro’s loan last week from DECD. The agency today stated that these emails were omitted from the original batch due to “an error” when transferring files.