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Request for Action <br /> <br /> <br /> <br /> <br />To Item Number <br />Economic Development Authority 6.1 <br />Agenda Section Meeting Date Prepared by <br />Public Hearing April 20, 2020 Amanda Othoudt, EDD <br />Item Description Reviewed by <br />Jobs Incentive Microloan Modification for Orluck Cal Portner, City Administrator <br />Industries, Inc. <br />Reviewed by <br /> <br /> <br />Action Requested <br />1. Open public hearing to consider comments on the first amendment to the loan agreement for Orluck <br />Industries, Inc. <br />2. Following the public hearing, the EDA is asked to consider adoption of the attached resolution <br />approving an amendment to the Jobs Incentive Microloan. The EDA may recommend approval, <br />approval with conditions, or denial of the request. <br /> <br />Background/Discussion <br />At their July 16, 2018, meeting, the City Council approved a $200,000 Jobs Incentive Microloan for Orluck <br />Industries, Inc., an aerospace manufacturer of seating, cargo, sensors, propulsion, and engine parts. They also <br />provide medical, locomotive, and manufacturing industry services. <br /> <br />Upon approval of the loan agreement, Orluck committed to the creation of 10 new jobs by July 20, 2020, and <br />retaining 54 existing jobs as a result of the project. They are also 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 />On March 6, 2020, Orluck indicated they would not be able to fulfill its commitment of adding 10 new <br />positions within two years of receiving their loan from the EDA. As of October 2019, Orluck reported 65 <br />employees, meeting their goal. However, by the end of 2019 they experienced a significant drop in demand and <br />between lay-offs and attrition were down to 55 employees. <br /> <br />Orluck has requested an extension of the benefit date for up to one year and amend the loan agreement to reflect <br />the extension of the benefit date as described in a first amendment to the loan agreement. All provisions of the <br />loan agreement will stay the same. <br /> <br />A public hearing must be held to invite comments for any modification to the loan agreement for business <br />subsidies in an amount greater than $150,000. <br /> <br />Financial Impact <br />N/A <br /> <br /> <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 />