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Ak ELK RIVER ECONOMIC DEVELOPMENT AUTHORITY <br /> MEMORANDUM <br /> TO: Economic Development Authority <br /> FROM: Marc Nevinski,Assistant Director of <br /> Economic Development <br /> DATE: December 13, 1999 <br /> SUBJECT: Micro Loan Fund Interest Rates <br /> Issue <br /> Staff is proposing that the eight outstanding micro loans with variable <br /> interest rates be renegotiated with fixed rates. <br /> Background <br /> Revisions to the Micro Loan fund policies earlier this year included_a <br /> . <br /> provision establishing a sub prime, fixed rate of interest for each loan. <br /> However, prior to the policy revisions, loans were negotiated with variable <br /> interest rates and adjusted every six months. Subsequently, the city's <br /> Finance Department spends a considerable amount of time managing these <br /> variable rate micro loans. <br /> Presently, the Micro Loan Fund has eight outstanding variable rate loans. <br /> • Beaudry Convenience 8.00% • LeFebvre Leasing 8.25% <br /> • Carpe Kairos 8.25% Second Generation <br /> • Galli Equipment 6.00% Properties 8.25% <br /> • Galli Real Estate 6.00% • Water Laboratories 7.75% <br /> • Indy Lube 7.75% <br /> Recommendation <br /> Staff recommends that the EDA authorize the renegotiation of a fixed rate of <br /> interest for the above Micro Loans at their respective rates listed above. <br /> Attachments <br /> • Summary of Micro Loans through November 30, 1999 <br /> • Micro Loan Fund Balance Sheet <br /> • <br /> 13065 Orono Parkway • P. O. Box 490 • Elk River,MN 55330-1743 • (612) 441-7420 • Fax (612) 441-7425 <br /> Equal Opportunity Housing and Equal Opportunity Employment <br />