3.0 HPSR 11-04-2004 - Laserfiche WebLink

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ELK RIVER ECONOMIC DEVELOPMENT MICRO LOAN FUND POLICY & GUIDELINES Revised June 2004 I. PURPOSE The Economic Development Authority for the City of Elk River (EDA) recognizes the need to stimulate private sector investment into manufacturing facilities and equipment in order to create new jobs, boost productivity and retain existing jobs for local residents. Additionally, the need exists to encourage investment in the expansion and/or rehabilitation of commercial and retail buildings in order to maintain the economic viability of Elk River's central business district. Subsequently, the purpose of this program is to provide low interest, long-term (i.e. greater than one year) loans as incentives for industrial development within the City of Elk River and to encourage commercial and retail business owners in the central business district to rehabilitate their existing buildings. II. LOAN PROGRAMS In order to meet the economic and community development objectives of the EDA, two distinct loan programs exist within the Micro Loan Fund to promote business growth in Elk River. The purpose of the Industrial Incentive Program ' o encourage industrial development that supports the tax b and brings quality jobs to the city. Amount: Equity: Rate: Term: $100,000 of secondary fmancin;~ot to exceed 20% of the t cost. Must hav nvate-sector co tments for 50% of the project cost. Borrower to ovide 10% more of project financing. Fixed; 2 points b e lowest prime rate published in the Wall Street J the day the loan is closed, or 3%, whichever is greater. Financ~ with a balloon pa~ pay nt must not be longer th ticipating bank. Loans may t in up to 5-years. The balloon the balloon payment of the ~mortized up to the following 15-years on real estate uses; 10-years on equipment uses. Elk River Economic Development Authority Micro Loan Fund Policy & Guidelines Revised June 2004 Page 2 of 8