6.3 EDSR 07-20-2015 - Laserfiche WebLink

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City of Elk River, Minnesota Morrell Trucking Microloan Fund Review June 18,2015 Page 2 3. Permitted Fund Uses of Microloan (Page 6 of Policy) To qualify for receipt of a microloan,the applicant must utilize the funds for the specific purposes outlined in the City's Economic Development Microloan policy. Funds may be used by the borrower for costs related to job creation and retention as a result of the project. According to the policy,loans may be used for the following activities: 1. Building construction 2. Land acquisition 3. Machinery 4. Furniture,fixtures,and equipment(FF&E) 5. Renovation and modernization of buildings 6. Exterior renovation of retail,commercial and industrial buildings 7. Public infrastructure needed for economic development expansions 8. Investment real estate with a minimum of 50%of the space pre-leased The applicant has indicated the funds would be used to aid in offsetting the cost of land acquisition. 4. Business Eligibility(Page 7 of Policy) In addition to having an eligible project a business must also meet certain criteria before it is deemed eligible to receive forgivable loan funds. According to the Economic Development Microloan Fund Policy, to be eligible for a microloan a business must meet the following • Business must be a for-profit corporation,partnership or sole proprietorship: • Business must be a small business as defined by the small business administration: • Business must have a positive net worth: • Business must be an industrial,manufacturing,or technology-based industry: • Religious, political, casino, sports facilities and pornographic enterprises are not eligible to use the Economic Development Forgivable Loan Program: Based on the submitted application, the business is a for-profit corporation defined as a small business, is an industrial, manufacturing or technology-based industry and is not a religious, political, casino, sports facilities, or pornographic enterprise. The most recent full years of financial statements show positive net worth. 5. Microloan Fund Terms &Conditions (Page 7 of Policy) To be determined if loan terms approved by the EDA. 6. Regulation for New Construction and Improvements (Page 7 of Policy) To be regulated if funding is approved and determined to be used for any improvements of the existing building.