Laserfiche WebLink
EDA Agenda Memo <br /> April,9, 1998 <br /> Page 4 <br /> 7. Consider Sportech Micro Loan Request- $45.000 <br /> The EDA Finance Committee met at 4 p.m. on Thursday, May 7, <br /> 1998, to consider a request by Chris Carlson of Sportech for a $45,000 <br /> micro loan. The purpose of the micro loan as explained by Mr. <br /> Carlson is to help facilitate a manufacturing project in east Elk River <br /> off of Jarvis Street. The parcel currently under purchaseagreement <br /> by Sportech is approximately 9 acres in size and is owned by Alltool <br /> Manufacturing. Mr. Carlson plans to construct a building of <br /> approximately 11,000 square feet to house his <br /> office/manufacturing/warehouse operations for Sportech. Sportech <br /> manufactures after-market snowmobile accessories and will be <br /> manufacturing plastic windshields specifically for Polaris <br /> snowmobiles in their new facility. <br /> Staff has been working with Sportech for approximately a year to <br /> locate a parcel which would meet their needs here in the city of Elk <br /> River. The nine acre Alltool parcel is approximately twice as large as <br /> is needed by Sportech, therefore, staff proposed the use of the EDA <br /> Micro Loan Fund to provide a financing source for 50 percent of the <br /> gib cost of the property. The staff concept is that Sportech will make the <br /> other half of the property available for another potential developer as <br /> soon as possible, and when the property is sold the EDA micro loan <br /> will be paid in full to a maximum term of three years. <br /> This is an example of utilizing the Micro Loan Fund as an incentive <br /> tool rather than a gap financing mechanism. <br /> The EDA Finance Committee unanimously supported a motion to <br /> recommend that the EDA provide a loan to Sportech with the <br /> following conditions: <br /> • 8.5% interest <br /> • 20 year amortization <br /> • 3 year balloon, or payoff when adjacent property is <br /> sold, whichever comes first <br /> • Personal guarantees required <br /> Recommendation <br /> Staff recommends support of the Finance Committee's recommendation to <br /> approve the Sportech micro loan in the amount of$45,000 with the terms as <br /> W listed. <br />