The Minnesota Business Partnership's new leader, former state legislator Kurt Zellers, has been sued by a bank for allegedly defaulting on a $75,000 home equity loan.
American National Bank claims Zellers and his wife, Kimberly Zellers, have failed to pay off the loan on their Maple Grove house since it matured in late June. Settlement discussions between the bank and the Zellerses failed, the bank said in a court filing.
Zellers said he is now working toward a resolution.
"Earlier this year, during a very difficult time for my family, we were late on a few payments on a loan," he said in a statement to the Star Tribune. "As we were working to resolve the issue, the bank chose to close the loan and demand payment."
In September, Zellers became CEO of the Minnesota Business Partnership, a prominent advocacy group representing more than 100 top executives in Minnesota, including leaders of all of the state's Fortune 500 companies. The group is a vocal advocate for business interests at the Capitol.
Nebraska-based American National Bank has not sought foreclosure, but on Oct. 23 it sued the Zellerses for breach of contract in Hennepin County District Court.
Zellers appears to be lining up new financing to pay off the American National Bank loan.
"We understood there was an alternate financing agreement in place that will resolve the issue in a matter of weeks, unfortunately the bank chose to file a lawsuit against us," Zellers said in a statement.
The bank said the Zellerses owe an outstanding principal of $73,980 and $2,466 in accrued interest, plus late charges. The variable rate loan had an initial rate of 5.25 % when it was issued in 2018, court records show.
Zellers spent more than a decade representing Maple Grove and Osseo in the Legislature, starting in 2003, including serving one term as speaker. He ran for governor in 2014, but he lost his bid for the GOP endorsement.
Zellers, 54, had been working in public relations and public affairs before the Minnesota Business Partnership tapped him to be its next leader.
Zellers replaced Charlie Weaver, another veteran state legislator, who retired after two decades leading the business partnership.