Laserfiche WebLink
Request for Action <br /> River <br /> To Item Number <br /> Economic Development Authority 6.1 <br /> Agenda Section Meeting Date Prepared by <br /> General Business November 16,2015 Amanda Othoudt,EDD <br /> Item Description Reviewed by <br /> Ethanol Technology of Minnesota,LLC Cal Portner, City Administrator <br /> Reviewed by <br /> Action Requested <br /> Direct,by motion, staff to proceed with the collection of the debt owed by Ethanol Technology of <br /> Minnesota,LLC. <br /> Background/Discussion <br /> In August 2008,the EDA approved a Micro Loan in the amount of$74,000 for Ethanol Technology of <br /> MN,LLC to assist in the purchase of equipment and complete remodeling for the expanded business <br /> venture. The term of the loan is a 10-year amortization; 5-year balloon payment. The rate was fixed at <br /> 3%. The loan was secured by a 2nd position lien on equipment,inventory,accounts receivable,real estate, <br /> and personal guarantee. In addition,the company was required to create seven fulltime positions at <br /> $15/hour wages within 2-years. <br /> The Micro Loan was structured as a participation loan with First National Bank of Elk River. The balance <br /> due on the EDA loan is $66,729.66. <br /> At the October EDA Finance committee meeting, staff presented an updated cost estimate from our legal <br /> counsel to collect the debt owed by Ethanol Technology of Minnesota,LLC. Upon review of the updated <br /> cost estimate,the EDA Finance committee made a recommendation to the EDA to proceed with the <br /> collection of the debt. <br /> Staff is requesting approval by the EDA to begin legal action in an effort to collect the debt owed by <br /> Ethanol Technology of Minnesota,LLC. <br /> Financial Impact <br /> The estimated cost to collect the debt from the borrower would range upward of$2,500 to $3,000. <br /> Attachments <br /> • EDA Finance staff memo dated June 23,2014 <br /> • EDA Finance staff memo dated September 22,2015 <br /> • Campbell Knutson letter dated October 5,2015 <br /> • Draft Notice of Default to Ethanol Technology of Minnesota,LLC <br /> • Draft Notice of Default to Barton C.Wells <br /> • Draft Notice of Default to Hitech Motorsport, Inc. <br /> r1111111 1 <br /> NATURE <br />