Gerald P. Carmen, head of the General Services Administration, has been granted two deferrals in the past year on $405,000 in outstanding low-interest loans from the federal government.
Carmen has not made a payment since July, 1981, two months after he took over at GSA. As a result, he now owes about $30,000 in additional interest to the Small Business Administration.
Carmen originally obtained a $425,000 loan from SBA in 1975 when an urban renewal project forced him to relocate his auto and tire service business in Manchester, N.H. SBA advanced the loan at 6.5 percent interest to Car-Go Home and Auto Centers Inc. Carmen personally guaranteed repayment of the loan. He sold his company in 1979, and it has since gone out of business.
Carmen has not listed the 30-year government loan as a liability on his financial disclosure statements.
Carmen said yesterday he asked the SBA for the first six-month deferral of his $2,700-a-month payments last summer. He subsequently obtained another six-month deferral that expires in July. So far, he has repaid $20,000 plus interest, and owes a balance of $405,000.
"We expect to meet that commitment," said Carmen, who makes $59,500 a year as GSA administrator. He said he would obtain a bank loan to cover the payments.
"Deferral is available to any American citizen," he said.
"I don't see where it's the late payments really of much interest," he said. "If I had been up in New Hampshire, I'd probably be handling it now. I'm not without resources. If they said you can't have a deferral, I would have covered it."
An SBA spokesman said, "This is a normal SBA procedure when a loan client through no fault of his own finds himself in financial difficulty and asks for a deferral. It is not a delinquency."
The spokesman said 17,000 of 149,750 loans made by the SBA or guaranteed by the agency are currently late by 60 days or more.
Though Carmen sold the business in 1979, he still owns the building and property, which he pledged as collateral on the SBA loan. Carmen rented the property to the new owner of the service center, who stopped making rent payments when he went out of business a year ago, just after President Reagan appointed Carmen to head the GSA.
Carmen said he now has an offer to buy the Elm Street property.
Before coming to GSA, which provides government workers with office space and supplies, Carmen was a paid consultant to the Reagan for President campaign. He owned the auto service center for some 20 years.
For the past year, Carmen has put in long hours at the government agency, cutting employes and office space allocations to reduce its budget. The agency accounts for $5 billion in government spending.
In a speech in March before the National Association of Manufacturers, Reagan noted that GSA, before Carmen took over, had been "racked by scandal" involving fraud and waste of government funds. Carmen promoted GSA's whistleblowers, who had previously been demoted for exposing wrongdoing, Reagan said.
Three months before Carmen stopped paying off his SBA loan, Reagan ordered a crackdown against those who owed the government loans and back taxes.
"We must make it clear that debts owed to the federal government must be repaid," the president said. "It is not right that responsible, honest citizens should suffer because of those who do not honor their obligations . . . . "
In an interview, Carmen drew a distinction between people who are behind in making payments "legally" and "those that deal outside that arena of legality ." He said, "We applied for a deferral. It was okayed."
Carmen said he would have listed the loan in his financial disclosure statement if he had thought it was required. The instructions require a listing of any business liability "in which your participation or ownership interest extends to personal liability for its debts."
J. Jackson Walter, director of the Office of Government Ethics, said he will look into Carmen's disclosure statement by asking GSA for more information.