6. EDSR 11-13-2012 - Laserfiche WebLink

Home Browse Search

c °r 7(4* I REQUEST FOR ACTION Elk River TO ITEM NUMBER Economic Development Authority AGENDA SECTION MEETING DATE PREPARED BY September 10, 2012 Annie Deckert, Director of Economic . Development ITEM DESCRIPTION REVIEWED By Discuss use of Department of Trade and Economic Cal Portlier, City Administrator Development (DTED) fund balance REVIEWED BY ACTION REQUESTED Discuss use of Department of Trade and Economic Development (DTED) fund balance BACKGROUND/DISCUSSION The EDA currently has a DTED fund balance of$703,679. These funds were originated from three grants the city received from from DTED under the MN Investment Fund program;Tescom (1992) and Sportech, Inc. (2003 and 2008). All three loans have since been paid back to the city, and closed by the state because they met all federal objectives required by the grant guidelines. Recently, staff met with staff from the MN Department of Employment and Economic Development (MNDEED, formerly DTED) to discuss the fund balance. It has been brought to our attention that these funds cannot be comingled with the Micro Loan Fund and any use of these funds must adhere to the federal guidelines,which include strict job creation/retention requirements for LMI (low and moderate income). Along with the federal guidelines comes a strict and frequent reporting requirement which must follow the funds forever. These reporting requirements are extensive and result in a considerable amount of staff time. MNDEED staff suggested the creation of a grant program,which may or may not require matching funds. Utilizing the money in this manner would only require the completion of the reporting requirements once per project;versus a continuing basis should the funds be provided in the form of a revolving loan. Additionally,MNDEED staff indicated that it's very likely the city would not be eligible for any funding from MNDEED until the balance of this fund was utilized. Staff feels there is an opportunity to create some type of grant program to market with the available lots in city owned Northstar Business Park and Nature's Edge Business Center. Doing this would not only increase our competitive advantage,but be an action step to fulfill the city's `Opportunities' goal by fostering a pro-business atmosphere that provides incentives and other opportunities for new and existing business growth. Staff is seeking input on how to proceed with the use of these federal funds. Some options may include, but are not limited to,the following: i rOWEREO RY NATURE