8.0. EDSR 03-08-1993 - Laserfiche WebLink

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IIEE FACT 003 0 U.S.Small Business.Administration SECTION 504 CERTIFIED DEVELOPMENT COMPANY PROGRAM PURPOSE 4. Have the ability to sustain its MINIMUM AMOUNT operations on a continuous basis from The purpose of SBA's Certified reliable sources of funds. The minimum amount of CDC Development Company program is to participation is$50,000. A S25,000 provide small businesses with 10-or 20- 5. Have at least five directors who meet debenture may be approved in special year financing for the acquisition of land quarterly. At least one director must cases. and building; machinery and equipment; have commercial lending experience. construction;and modernization, USE OF PROCEEDS renovation or restoration of existing 6. Have incorporated within its bylaws facilities and sites. and articles that its chief purpose is to Proceeds may be used for the following "promote and assist the growth and fixed asset projects: WHAT IS A 504 CERTIFIED development of business concerns DEVELOPMENT COMPANY? including small businesses." 1. Purchase of existing buildings. A Certified Development Company HOW DOES A CDC WORK? 2. Purchase of land and land DC) is a private/public sector non- improvements(grading,street fit corporation whose purpose is to The 504 Certified Development improvements,utilities,parking lots,and ontribute to the economic development Company is a conduit which allows landscaping. of its area of operation. It must meet the private funds,guaranteed by SBA,to following criteria: flow into community business. 3. Construction. 1. Operate in a defined area. 1. It is authorized to sell 100 percent 4. Modernization,renovation,or SBA-guaranteed debentures to private conversion of existing facilities. 2. Be composed of 25 or more members investors in amounts of up to 40 percent who are geographically representative of of a project or$750,000,whichever is 5. Purchase of machinery and the CDC's area of operation and who lesser. equipment. include representatives from each of the following groups: 2. A CDC's portfolio must create or 6. Construction contingency fund not to retain one job for every S 15,000 of exceed 10 percent of construction costs. a. Government agencies in the area debenture financing. of operation. 7. Interest on interim financing. 3. Debenture proceeds provide b. Private sector lending institutions. permanent financing. Therefore,interim 8. Professional fees directly attributable financing will be required. to the project(surveying,engineering, c. Business concerns. architectural,appraisal,legal,and MAXIMUM AMOUNT accounting). d. Community organizations. The maximum amount of CDC TERM 3. Must provide a full-time professional participation in an individual project is staff with the capacity to market the $750,000. Total project size is Maturities of 10 and 20 years are rogram and process,close and service unlimited. A practical project size is$1 available. an portfolio. to$2 million.