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Request for Action <br /> <br /> <br /> <br /> <br /> <br />To Item Number <br />Economic Development Authority 7.4 <br />Agenda Section Meeting Date Prepared by <br />General Business May 16, 2022 Brent O’Neil, Economic Development Director <br />Item Description Reviewed by <br />EDA Incentive Programs and Fees Cal Portner, City Administrator <br />Reviewed by <br /> <br /> <br />Action Requested <br />Approve, by motion, a modification to the application fees for EDA Loan Programs <br /> <br />Background/Discussion <br />Staff intends to complete a comprehensive review of the EDA’s existing incentive programs over the coming <br />months and share recommendations with the EDA. However, staff is proposing an interim change to the <br />application fee for the EDA’s loan programs until a full review is completed. <br /> <br />In the past few months, we have received multiple inquiries regarding the Business Microloan Fund, which <br />includes multiple loan programs. The application fee to apply is $2,000, and in many cases the loan amount <br />discussed range from $25,000 to $75,000. None of the inquiries materialized into an actual application. The fee, as <br />a percentage of the loan amount, can be considerably high in this instance, and is outside of common practice in <br />the region. The attached summary shows what other nearby communities charge as an application fee for their <br />loan programs. <br /> <br />Staff would like to have a discussion on the current fee structure and determine whether the EDA would like to <br />modify the loan amount to any or all programs until a more thorough review is completed. Existing programs and <br />their maximums are stated below: <br /> <br />Jobs Incentive Microloan - $200,000 <br />Downtown Business Loan - $74.999 <br />Industrial Incentive Loan - $200,000 <br />Microbrewery Loan - $74,999 <br />Energy Efficiency Loan - $74,999 <br /> <br />As a short-term adjustment, a fixed fee around $500, especially for the small non-industrial loans, or a one-percent <br />application fee is more in line with peer communities. <br /> <br />Financial Impact <br />N/A <br /> <br /> <br />The Elk River Vision <br />A welcoming community with revolutionary and spirited resourcefulness, exceptional <br /> <br />service, and community engagement that encourages and inspires prosperity. <br /> Updated: August 2020 <br />