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4. Late Payment Charge <br />A late payment charge of up to 8% of the installment amount may be enforced. <br />VI. REGULATION FOR NEW CONSTRUCTION AND IMPROVEMENTS <br />All buildings which public funds will be used for construction or renovation are to <br />be brought into conformance with city codes and policies. Repairs may include the <br />following systems and portions of real property: <br />a. Mechanical heating, plumbing, and electrical <br />b. Structural; including the facade of the structure and energy related <br />unprovements. <br />Hook-up to city services (i.e. water, sewer) <br />VII. LOAN SECURITY AND GUARANTEES <br />Applicant must be able to secure the loan by providing the EDA with a minimum of <br />a subordinate mortgage upon the building and/or assets or other approved collateral. <br />Applicant must demonstrate the financial means to repay the loans, as determined by <br />the Economic Development Authority. <br />Whenever possible, personal guarantees will be made part of any loan agreement. <br />VIII. TIMING OF PROJECT EXPENSES <br />No project should commence until the Elk River Economic Development Authority <br />has approved the loan application. Any costs incurred prior to the approval of the <br />loan application are generally not eligible expenditures. <br />No building construction should commence until the required City permits are <br />secured. <br />The applicant will be responsible for all legal, recording, and other fees required for <br />protection of a security interest in the loan, payable by a 1% processing fee, which is <br />paid at the time of application. <br />IX. PROCEDURAL GUIDELINES FOR APPLICATION AND APPROVAL <br />1. All applicants shall first contact a primary lending institution to determine if <br />additional equity is needed, and if so, how much. <br />The applicant and the primary lender shall then meet with City Staff to obtain <br />information about the Micro Loan program, discuss the project, and obtain <br />application forms. <br />3. The applicant shall complete and submit an application form to the City, along <br />with a processing fee of 1% of the loan request. (The fee is used to cover <br />processing expenses and will be returned if application is denied.) The applicant <br />must provide evidence of their ability to meet the equity requirements or provide <br />Elk River Economic Development Authority <br />Micro Loan Fund Policy & Guidelines <br />Revised June 2004 <br />Page 5 of 8 <br />