2.0. HRSR 03-10-1998 - Laserfiche WebLink

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Create a revitalization loan Tax increment financing will not fit the need of every project. A program of and grant program loans and grants may be a more effective option for smaller projects and for the rehabilitation of existing buildings. Creating a program will revolve • around issues of objectives, structure and funding. • A loan and grant program requires objectives. In general terms, the loan program is intended to assist in the revitaliza- tion of the Downtown area. There are many facets to the revitalization effort. In designing a loan program, the EDA must consider the results it hopes to achieve. It is unlikely that there will be enough money to fund all possible applications. Therefore, the prioritization of objectives helps to target the use of available funds. Setting objectives also influences other decisions about the loan pro- gram and about the overall implementation of the Plan. The list below identifies some potential objectives: • Enhance storefronts and facades in accordance with the design guidelines in the Plan. • Encourage the rehabilitation of building interiors to bring them into compliance with local codes and ordinances. • Encourage building rehabilitation to provide space suitable for the proposed use. • Provide funding to close the "gap" between financing needed to undertake the project and the amount raised by equity and private loans. • • Provide economic incentives to locate businesses in the Downtown. Public objectives are only one part of the equation. The program will not be successful if it fails to encourage private investment. The design of the loan program should take into account the economic barriers to business development in the Downtown. A final objective is the assessment of risk. Commercial rehab loans carry more risk than the loans made for industrial development. With small commercial projects, the applicant is likely to have a good idea and not a detailed business plan. Some good ideas may become viable businesses and others will not. At the outset, careful consideration must be given to the implications of the unsuccessful project. The nature of the acceptable level risk will shape guidelines on the nature of the loan, the type of project and the administration of the program. • Design the administrative structure to fit local needs. The nature of the loan program has implications for the time and effort required to support the program. Processing loans to be administered by the City (through the EDA or HRA) requires a commitment of staff time. This commitment could be reduced by a program that works in conjunction with a local bank. It is also important to consider the steps, • �"_ A New Bridge - - Revttallzing Monticello's Downtown and Rlverfront Page 4:22