CANTON, Ohio — A state court here rejected a bid this week by the Stark Metropolitan Housing Authority to evict the tiny credit union it chartered, clearing the way for the merger of $2 million SMHA FCU.
The housing agency, seeking lease and other compensation from the credit union after a Department of Housing and Urban Development audit found it misspent $8 million — $2.1 million of it subsidizing the credit union — and sought to evict SMHA FCU because it fended off payment requests.
Credit unions officials say they have a deal to merge into a larger credit union but first need to clear up uncertainty over its legal status, including the future of its lone branch in the housing development.
This week's ruling by the Canton Municipal Court, however, does not end the legal battle because the credit union is suing the housing agency over non-payment of some $50,000 of subsidies a year and other assistance. That case was removed from federal court this week to the state court.
The credit union was chartered in 2001 to serve employees and residents of the local housing developments and serves about 2,000 members.
