7.7. SR 04-18-2016 - Laserfiche WebLink

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City of Elk River, Minnesota Die Concepts Inc. March 23, 2016 Page 2 sources would be provided privately through debt(58.4%)and equity(11.9%)with approximately 30%funded publicly through the HRA Blighted Properties Forgivable Loan (8.1%)and EDA Jobs Incentive Microloan (21.6%). Project Costs Amount Sources Amount Land 80,000 8.6% Bank Loan 540,800 58.4% Buildings 320,000 34.6% Applicant Equity 110,200 11.9% Remodeling 526,000 56.8% HRA Blighted Properties 75,000 8.1% EDA Microloan 200,000 21.6% Total 926,000 Total 926,000 The Blighted Properties Forgivable Loan Program has certain criteria that must be met. The maximum amount of financing that can be provided is up to $75,000 and federal guidelines require a minimum of one job be created for every $15,000 that is requested. The applicant must provide at least 50% of the total project cost through other means and equity down payment requirements may vary depending on project and primary lending institution. Blighted Properties Forgivable Loan funds may be used as equity upon approval of primary lending institution. Projects can combine the Blighted Properties Forgivable Loan funding with other incentives (Microloan Program, for example). As shown in the table above, the applicant will provide more than 50% of the total project cost from other means with approximately 70%financed through debt and equity. Purpose The Blighted Properties Forgivable Loan funds are to be used for business start-ups, expansions, and relocations where jobs are created and tax base is generated based on the following means: 1. Creation of permanent private-sector jobs to create above-average economic growth 2. Stimulation or leverage of private investment to ensure economic renewal and competitiveness 3. Increase local tax base 4. Improvement of employment and economic opportunity for citizens in the region to create a reasonable standard of living 5. Stimulation of productivity growth through improved commercial, retail, manufacturing or new technologies Project Eligibility Requirements under Blighted Properties Forgivable Loan Program For a project to qualify under the Blighted Properties Forgivable Loan Program of the City of Elk River Housing and Redevelopment Authority an applicant must meet certain criteria: 1. Created and retained jobs must pay greater than$15.00 per hour or 150%of State or Federal minimum wages(whichever is greater): 2. Increase in tax base 3. Project can demonstrate that investment of public dollars induces private funds 4. Project provides higher wage levels to the community or will add value to current workforce skills 5. Project results in the sale and/or redevelopment of properties deemed structurally substandard 6. Whether assistance is necessary to retain existing businesses