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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 />7.1 <br />Agenda Section <br />General Business <br />Meeting Date <br />September 16, 2019 <br />Prepared by <br />Amanda Othoudt, EDD <br />Item Description <br />Industrial Incentive Microloan Application for <br />Distinctive Iron, LLC <br />Reviewed by <br />Cal Portner, City Administrator <br />Reviewed by <br /> <br /> <br />Action Requested <br />Approve, by motion, a resolution approving the Industrial Incentive Microloan. The EDA may <br />recommend approval, approval with conditions, or denial of the request to the City Council. <br /> <br />The Council will review the recommendation and formally act on the request at their regular meeting. <br /> <br />Background/Discussion <br />Distinctive Iron, LLC, located at 19128 Industrial Blvd NW, submitted an application for a $100,000 <br />Industrial Incentive Microloan. They are a woman-owned and operated company that designs, fabricates and <br />installs structural and miscellaneous steel products. They propose to purchase property located at 15970 <br />Jarvis St. NW, renovate the existing building and construct a 4,680 sf indoor paint facility. <br /> <br />They would invest $1,529,480 to purchase, renovate and construct the new facility, and retain 14 FT and 2 <br />PT jobs. They anticipate 5 more FT jobs over the next two years. The project will add approximately <br />$135,000 in taxable value and increase taxes by about $4,944 annually. <br /> <br />The Joint Finance Committee reviewed the application, financials and supporting information and <br />determined the fundamental policy goals are met. They will be required to meet the requirements of the city’s <br />Business Subsidy Policy for the creation of new jobs, as well as a 5-year location requirement. <br /> <br />Financial Impact <br />The applicant has an existing city loan with a balance of approximately $89,338.20. They request the loan <br />be refinanced with the new request for a total of $189,338.20. The Committee recommended the request <br />which will be amortized over 20 years at 3% with a 5-year balloon payment. The EDA will retain a 2nd <br />position on all equipment and real estate. In addition, the loan will be secured with a personal guarantee. <br /> <br />The Microloan Fund account balance is $955,487.04. <br /> <br />Attachments <br /> Joint Finance Committee Meeting Packet (August 27, 2019) <br /> Resolution <br /> Loan Documents <br />