5.0. & 5.1. & 5.2. EDSR 04-14-2008

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~~ ~•- iver MEMORANDUM TO: EDA Finance Committee Tim Simon, Finance Director FROM: Catherine Mehelich, Director of Economic Developmen DATE: April 8, 2008 SUBJECT: Consider Micro Loan Application -Sportech, Inc. A meeting of the EDA Finance Committee will be held at City Hall on Tuesday, Apri18, 2008 at 7:00 am to review a Micro Loan application. Attached is the Micro Loan application submitted by Chris Carlson of Sportech, Inc. Sportech is an established Elk River company that designs and produces plastic components fox primarily the powersports industry. Mr. Chris Carlson will be present to discuss the project with the committee. Staff has been working with Sportech, Inc. over the past year to identify a site and financing assistance to relocate and expand the company's operations in Elk River. The proposed project includes selling its existing facilities located on Jarvis Street, and relocating to a 9.29- acre lot in the EDA-owned Northstar Business Park to accommodate the construction of an 80,000-square foot light industrial facility, the retention of 66 full-time jobs and the creation of 25 new full-time jobs within 2-years of project completion. The expansion project, estimated at a cost of $6,359,000, will involve finance participation from the company's lender, equity participation, and the following public financing applications as outlined in the attached sources & uses: • City of Elk River Tax Abatement (land purchase) $404,672 • Sherburne County Tax Abatement (land purchase) $404,672 • EDA Micro Loan (equipment) $100,000 • Ciry application to MN Dept of Employment $500,000 & Economic Development (DEED) fox a MN Investment Fund loan (equipment)