9.0. EDSR 02-14-1994 - Laserfiche WebLink

Home Browse Search

MHFA MORTGAGE PROGRAM • In April, 1993, the EDA made application to the Minnesota Housing Finance Agency (MHFA) for an allocation of first time homebuyer funds known as the Minnesota City Participation Program (MCPP). Elk River's $1,500,000 request for mortgage funds was reduced to $974,242. Under the program, the mortgage funds are used to assist first time homebuyers with the purchase of new or existing homes. To qualify for the 1993 funds, an applicant's adjusted income cannot exceed $39,680 and the maximum purchase price cannot exceed $95,000 (new construction) or$85,000 (existing homes). Because of the 1992 sunset provision which prohibited cities and states from issuing revenue bonds for this purpose, the MCPP program was delayed until the fall of 1993. The program's initial interest rate on 30 year mortgages is 6.25% (7.033 APR). MICRO LOAN FUND The balance of the EDA's micro loan fund as of January 1, 1993, was $199,741.75 (excluding December, 1992 interest). The year end balance was approximately $118,541.30 (excluding December, 1993 interest). Five loans were closed in 1993: Business Name Loan Amount Coldwell Banker Allegiance $ 27, 500 STescom Corporation $ 50,000 Indy Lube $ 24,700 R& D Sales $ 17,500 Beaudry Convenience $ 50,000 Two other loans were approved during the year but will be closed during 1994. These include a $15,000 loan to Water Laboratories and an $18,750 loan to Woodsmen Quality Products. Including the DTED loans, the EDA currently has thirteen loans outstanding. The original principal balance of these loans was $1,367,200. Total principal outstanding on these loans as of December 31, 1993, is $1,210,294.43. Of this amount, DTED will receive $500,000 (Alltool: $100,000; Roma Tool & Plastics: $400,000). Attached as Exhibit A to this report is a summary of loans currently outstanding. ECONOMIC DEVELOPMENT NEWSLETTER The EDA continued publishing a newsletter on economic development issues during 1993. The newsletter is mailed to approximately 1,500 persons and companies associated with real estate development, construction, design, and sales. This mailing list was developed by City staff and was obtained primarily through accessing certain 4111 professional real estate associations.