7.1. SR 08-22-1994 - Laserfiche WebLink

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. Pursuant to a Loan Agreement dated May 18, 1993, the City loaned the Small Cities funds to Tescom Corporation, 12616 Industrial Boulevard, Elk River, Minnesota. The funds were used by Tescom to assist with the financing of certain equipment needs associated with the expansion of its high purity controls division. . To further support this expansion, the City provided the following: $1,500,000 Industrial Development Revenue Bond (IDRB) for the project's primary mortgage financing; . $153,000 from Tax Increment Financing (TIF) as a grant for land write down ($100,000) and site preparation ($53,000); and, . $50,000 micro-loan for equipment purchases. Construction of Tescom's 28,000 square foot facility for its high purity controls division began in mid-1993. A Certificate of Occupancy was issued in late November and production in the facility began in December, 1993. Pursuant to an Assessment Agreement, the project's finished market value is $1,200,000. Tescom's industrial control division continues to occupy the 35,000 square foot facility. . Tescom estimated that it would create 45 new permanent jobs as a result of this expansion. Of the 45 newly-created jobs, it was estimated that 34 would benefit LMI persons. To document this, all new employees are asked to complete a Notice to Prospective Employee. This Notice provides a range of total family income based on family size. An employee is then determined to be either low-income (LI) or low- or moderate-income (LMI), or non-LMI. The family incomes for these categories are derived from annual estimates from the Department of Housing and Urban Development (HUD). A copy of the current Notice, together with the latest HUD family income estimates, is attached to this memo. Initially, family income estimates from the St. Cloud Metropolitan Statistical Area (MSA) were used in the tracking of jobs that benefit LMI persons. Since late May, 1994, the Minneapolis/St. Paul MSA family incomes have been used. From the date of the grant award announcement through June 30, 1994, Tescom estimates that it has created 61 permanent jobs. Of the total, 27 jobs have been taken by LMI persons. It should be noted that the 61 jobs is not an indication of Tescom's true growth. Some of the jobs have been filled through various vacancies in the organization. A more reflective number of the newly-created positions is 44 jobs. Tescom has through December 31, 1994, to fulfill its obligation of creating the permanent jobs as outlined earlier. . The $250,000 loan to Tescom is structured as a 10 year loan. For the first five years, the loan will carry an interest rate of 4.5 percent. In years six