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<br />The Elk River Vision <br />A welcoming community with revolutionary and spirited resourcefulness, exceptional <br />service, and community engagement that encourages and inspires prosperity <br />Request for Action <br /> <br /> <br />To <br />Economic Development Authority <br />Item Number <br />6.5 <br />Agenda Section <br />General Business <br />Meeting Date <br />August 20, 2018 <br />Prepared by <br />Amanda Othoudt, EDD <br />Item Description <br />Energy Efficiency Microloan Application for <br />Ralphie’s Minnoco <br />Reviewed by <br />Cal Portner, City Administrator <br />Reviewed by <br /> <br /> <br />Action Requested <br />Consider the adoption of a resolution approving a Jobs Incentive Microloan. The EDA may approve, <br />approve with conditions, or deny the request to the City Council. <br /> <br />The City Council will review the recommendations and formally act on the request at their regular <br />meeting later this evening. <br /> <br />Background/Discussion <br />Ralphie’s Minnoco is a self-service gas station operating in a 3,000 square foot facility at 13374 U.S. <br />Highway 10. The gas station emphasizes food service, fuel, inside sales, U-Haul rental, and propane <br />sales. Owner Brian Brehmer plans to use the loan to finance energy efficiency lighting to the property <br />and the space leased to Mama D's Deli. <br /> <br />Mr. Brehmer is requesting a $19,175 Energy Efficiency Microloan to defray the cost of new LED lights <br />and improve perception of the gas station. He indicated a gas station image is a large determinant of its <br />success and improving the lighting and outward appearance will increase business. <br /> <br />Ralphie’s received a $74,999 Energy Efficiency Microloan in 2013. They are current on their payments <br />and are scheduled to pay off the remaining balance of $41,104.35 on September 1, 2023. <br /> <br />The EDA attorney stated fund disbursement for new expenditures should be structured as a new loan <br />rather than a modification of the first loan because it is a new project. If approved, the EDA could <br />subsequently consolidate the loans into one payment. <br /> <br />The Joint Finance Committee reviewed the application at their July 31, 2018, meeting and recommended <br />approval of the application. The terms of the microloan are as follows: <br /> <br />Ralphie’s Minnoco <br /> Amount requested: $19,175 <br /> Rate requested: Fixed at 3% <br /> Equity proposed: 10% <br /> Term: 5-year amortization