7.8. EDSR 08-17-2020 - Laserfiche WebLink

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Request for Action Cir•ci Elk - River= To Item Number Economic Development Authority 7.8 Agenda Section Meeting Date Prepared by General Business August 17, 2020 Amanda Othoudt,EDD Item Description Reviewed by COVID-19 Small Business Emergency Cal Portner, City Administrator Microloan Program Update Reviewed by Action Requested Provide direction to staff on the COVID-19 Small Business Emergency Microloan Program. Background/Discussion At their May 18, 2020, meeting,the EDA established the COVID-19 Small Business Emergency Microloan Program to assist small businesses and allocated up to $200,000 from the Economic Development Business Microloan program as the source of funding. The program was designed to offer zero interest loans up to $20,000, amortized over 10 years,payments deferred for 6-months to businesses which includes a forgivable loan component for up to $5,000 in property tax relief. Following the establishment of this program, Governor Tim Walz authorized funds provided by Congress through passage of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) to states and local governments to cover costs associated with the COVID-19 pandemic. At their July 20, 2020, meeting, the EDA directed staff to recover costs associated with the COVID-19 Small Business Emergency microloan program through the CARES Act if there are funds available. Based on the direction at the last meeting, staff worked with our EDA attorney to modify the program so that the EDA could reimburse themselves through the CARES Act. We planned to present this information to the EDA this evening. It has since come to my attention that the city has identified potential expenditures which will utilize nearly all the designated CARES Act funds recently allocated to the city. Provided there are funds still available after these important expenditures,the EDA may pass a resolution modifying the COVID-19 Small Business Emergency Microloan program. Funds must be expended by November 15, 2020. If the EDA continues to fund the program without reimbursement from the CARES Act,the EDA will have maximum flexibility in determining the businesses eligible for assistance. This would require the EDA attorney to draft new language which would not be ready this evening. Staff is looking for direction on how you would like to proceed. 1.) Keep the program as is, and if there is money left over after the identified expenditures,the EDA can request that the City Council pass a resolution prior to Nov 15 to allow the EDA to reimburse themselves through the CARES Act. The Elk River Vision PONE H E o s Y A �arelcoming community avith revolutionary and spirited resourcefulness, exceptional INAV service, and community engagement that encourages and inspires prosperity. Updated.August 2020