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EDA Agenda Memo Page 3 <br /> March 3, 1993 <br /> • origination fees and monthly mortgage servicing fees as <br /> its fundamental source of revenue. Therefore, a CDC <br /> operating in Elk River may not cash flow until it achieves <br /> a certain level in its mortgage portfolio. I have, <br /> however, discussed the concept of a County-wide CDC with <br /> my colleagues in Sherburne County. While this is a better <br /> idea, the problem with generating revenues remains the <br /> same. <br /> Another alternative is to align Sherburne County with an <br /> existing nonprofit development company. My colleagues and <br /> I have had numerous discussions on this topic with the <br /> Administrator from the Coon Rapids Development Company <br /> (CRDC) . We believe this alignment makes a great deal of <br /> sense. That is, small businesses here can receive the <br /> benefit of the services provided by the CRDC, while the <br /> County or cities do not incur the start up costs of a new <br /> CDC. <br /> Several issues emerge with the potential expansion of the <br /> CRDC into one or more new counties, including Sherburne. <br /> The organization's name will likely change to be <br /> reflective of a multi-county organization. Representation <br /> on the existing CRDC board will change, and further, <br /> additional stock purchases/donations will be required from <br /> 110 the new territories served by the CRDC. <br /> My colleagues and I have asked the CRDC to prepare <br /> projections of expenses and revenues for a multi-county <br /> CDC. A projected revenue indicates a $10,000 stock <br /> purchase/donation from each new county that would be <br /> served by this new organization. We are proposing that <br /> several cities, EDA' s, utility companies, and banks each <br /> consider a $1,000 stock purchase in this expanded <br /> organization. <br /> The Administrator of the Coon Rapids Development Company <br /> will make a presentation to the EDA Commissioners on March <br /> 8 . Additional information on the CRDC and the concept of <br /> a multi-county CDC is found in a separate memo. <br /> Action Requested <br /> Following a presentation by the CRDC Administrator, the <br /> Elk River EDA is asked to authorize a letter of support <br /> for a multi-county organization and to pledge a $1,000 <br /> stock purchase in this new organization. The stock <br /> purchase would be payable once the multi-county <br /> organization is operational . Since SBA also approves <br /> service territory expansions, a likely time frame for this <br /> • is October 1, 1993. <br /> 9 . REVISIONS TO LOAN POLICY GUIDELINES <br />