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<br />Case #2: <br /> <br />Revolving Loan Fund (minutes from February 2005 EDA meeting) <br /> <br />Economic Development/TIF Specialist Sullivan reviewed that Economic Development <br /> <br />Consultant Mulrooney provided information and answered questions regarding the City's <br /> <br />revolving loan fund at the January 12th EDA meeting. The EDA raised questions regarding the <br /> <br />employment requirements established in the guidelines, the effectiveness of the loan with such a <br /> <br />small fund balance, and what types of projects should receive this financing tool. Staff was <br /> <br />directed to suggest changes to the Revolving Loan Fund Guidelines that reflected this discussion. <br /> <br />The recommended changes are before the EDA. Staff is looking for a recommendation from the <br /> <br />EDA that the City Council adopt the proposed guidelines. <br /> <br />Economic Development Consultant Mulrooney explained some ofthe changes would clean up <br /> <br />the guidelines and other changes were made based on the discussion at the last meeting. He <br /> <br />reviewed the following changes to the Revolving Loan Fund Guidelines: <br /> <br />II. Authorization and Funding Sources: Correction to Minnesota Department of <br />Employment and Economic Development <br />VI. Ineligible Activities: Retail businesses has been added. <br />VII. Loan Terms and Conditions: <br /> <br />(B): Interest Rate: An index has been provided to give an incentive for the financial program <br /> <br />that is pegged to the treasury rate. The treasury rate is not as volatile as the prime rate. <br /> <br />(D): Wage andjob goals, Item 1: A business loan through the program less than $75,000 <br /> <br />would not be required to establish wage and job goals, while this would be required of <br /> <br />business loans in excess of $75,000. This would provide flexibility as discussed at the <br /> <br />last meeting. <br /> <br />32 <br />