9.0. EDSR 04-14-2003 - Laserfiche WebLink

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Micro Loan Policy Amendment Issues Updated from Feb. 18,2003 Committee Meeting Page 2 of 3 • 4. Equity (Page 2 & 3): Staff recommends including language specifying the following: At least 50% of the total project cost must be privately financed through owner equity and other lending sources. Committee suggested using SBA504loan requirements for language. Consensus was that at least 10% of the project must be from the owner's equity and that at least 50% of the project be privately financed through owner equity and other lending sources. See SBA information attached as provided by committee member McNair. 5. Refinancing (Page 2 & 3): Staff questions for discussion: Should refinancing be allowed just to take advantage of lower rates? No Should a market rate be continued or stated as prime plus x ? Market Rate What criteria should be considered for refinancing/extensions, same application form? Written request and current financial statements should be submitted for consideration. Staff recommends a processing fee be applied to cover legal and filing expenses. Typically staff is seeing these expenses range from $500 - $1,000 total. $500 upfront processing fee should be required on refinancing requests. Staff recommends that the Finance Committee review all refinancing applications. Yes Staff recommends adding language that allows the EDA to require automatic payment be structured with the applicant's lender. Yes Discussion on remaining issues tabled until the next Committee meeting. 6. Eligible Uses (Page 4): The EDA Board directed the Finance Committee to review and provide recommendation if "investment property development" be considered an eligible use of the Micro Loan. See page 4 of EDA 1-13-03 meeting minutes attached. Issue: If Micro Loan was used for building improvement/development but the business relocates or business is sold to different owner, should the loan be called due? Should all loans agreements be in the name of the business applicant to avoid such issues? 7. Industrial Incentive Program (Page 2): The Finance Committee discussed opening this program up to city-wide locations rather than targeting the West Business Park areas. See attached industrial business park sites and a copy of the Committee discussion notes from 6-20-99 and 8-21-97.