7.0. EDSR 04-12-1993 - Laserfiche WebLink

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TO: EDA FINANCE COMMITTEE lk River FROM: WILLIAM RUBIN, ED COORDINATO U " - DATE: MARCH 31, 1993 SUBJECT: LOAN REQUEST FROM TESCOM CORPORATION, INC. INTRODUCTION Tescom Corporation, Inc. , 12616 Industrial Boulevard, requests a loan from the EDA Revolving Loan Fund in the amount of $50,000 . This loan will be used by Tescom Corporation to leverage existing financing sources for the construction of a new 28,000 square foot facility in the Elk River Industrial Park for its high purity controls division. This expansion will enable Tescom to operate its two divisions autonomously. Its industrial controls division will be retained in the existing 34,000 square foot facility. BACKGROUND The request for a $50,000 loan from the EDA completes the final 411 element in Tescom' s financing package. The cost of constructing the new facility, equipping it, and remodeling the existing facility totals $2, 161,900 . Those costs are broken down as follows : - Building $ 950,000 - Land $ 100,000 - Equipment, Machinery, Fixtures $1,031,900 - Remodeling (Existing Facility) $ 80,000 TOTAL $2, 161,900 Sources of financing for this project are broken down as follows : - Industrial Development Revenue Bond (IDRB) $1,500,000 ( issued 6/92) - Capital Equipment Allocation (Norwest Bank) $ 114,200 - Working Capital (Norwest Bank) $ 147,700 - DTED-City Loan $ 250,000 (approved 10/92) - Tax Increment Financing (TIF) $ 100,000 (approved 3/93) - EDA Revolving Loan $ 50,000 TOTAL $2, 161,900 In order to qualify for the DTED Grant-City Loan in the amount of $250,000, it was necessary to demonstrate that all sources of local incentives had been maximized. That is, DTED will not approve grant requests unless a City fully utilizes its 720 Dodge Avenue N.W., Elk River, Minnesota 55330 (612) 441-7420