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PROGRAM PROFILE <br /> SMALL BUSINESS DEVELOPMENT LOAN PROGRAM <br /> <br /> Program purpose: To create jobs and provide loans for business expansions. <br /> <br /> How it works: The Minnesota Agricultural and Economic Development Board (MAEDB) makes small <br />business loans through the issuance of industrial development bonds backed by a state-funded reserve of 25 percent. <br /> <br /> Eligible applica~.ts: Manufacturing and induslxial businesses located or intending to locate in Minnesota, as <br />de£med by Small Business Administration size and eligibility standards; generally, those with 500 employees or fewer. <br /> <br /> Minimum requ~ements: New capital investment resulting in a significant number of new jobs and other <br />beneficial economic impacts. <br /> <br /> Eligible projects~ Acquisition of land, building, equipment; building construction and renovations; develop- <br />ment costs such as eng~eering, legal and financial fees. Working capital and refinancing are not eligible uses of funds. <br /> <br /> Maximum available: $500,000 minimum, up to a maximum of $4 million. <br /> <br /> Other funds req ~Uired: Generally, 20 percent of the project costs must be privately f'manced through equity <br />or other private source.q; 25 percent is required on equipment transactions. Where there is sufficient non-cash equity <br />available in the project,!MAEDB may consider a loan-to-value ratio greater than 80 percent~ <br /> <br /> Interest rate: <br />term of the loan. <br /> <br />Market rate of interest for similar securities at the time bonds are sold. Rates are fixed for the <br /> <br /> Terms: Real ~state at maximum of 20 years; equipment at 10 years or 80 percent of useful life; not to exceed <br />weighted average useful life of assets financed. <br /> <br /> Collateral requir~ements: First mortgage on real property or equipment financed by MAEDB and personal <br />guarantees of owners. In some cases, additional security in the form of other liens or guarantees may be required by <br />MAEDB or bond unde ~r3,riters. <br /> <br /> Fees and other cbsts: No MAEDB fee, but board issuance costs of 5 percent are capitalized with the loan <br />principal, One year's debt service must be escrowed. <br /> <br /> Applicationsaccgpted: On a year-round basis through the Community Development Division's single <br />application process. Applications must be received by the first of each month to be considered during that month. <br /> <br /> Approving authority: Minnesota Agricultural and Economic Development Board. <br /> <br />City of Ramsey <br />Ramsey Municipal Center <br />15153 Nowthen Blvd. N.W. <br />Ramsey, MN 55303 <br /> <br />Bulk Rate <br />U.S. Postage Paid <br />Permit No. 131 <br />Anoka, MN 55303 <br /> <br />For additional Information about the City call 427-1410 <br /> <br /> <br />