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ARDEN HILLS EDA MEETING—APRIL 28, 2014 5 <br /> (real estate acquisition) have a longer amortization and term. If the goal is to see a quicker return <br /> of loan repayments, the City should focus on projects with short-term amortization periods of ten <br /> years or less. <br /> The following types of projects should be eligible for loans issued through the RLF: <br /> • Real property improvements <br /> - Internal fixed improvements (walls, ceilings, floors, lighting, windows, doors) <br /> - Streetscape and landscaping improvements <br /> - Plumbing, electrical, and mechanical systems <br /> - Air conditioning <br /> - Roofing <br /> - Parking lot surfacing and lighting <br /> -Accessibility improvements <br /> -Energy conservation and energy retrofits <br /> • Commercial fagade improvements <br /> - Cleaning and painting of exterior surfaces <br /> - Repair or replacement of windows, doors, cornices, masonry, awnings, and decorative <br /> details <br /> - Sign removal, repair, or replacement <br /> • Fixed asset equipment <br /> - Production equipment <br /> Associate Planner Bachler reported that the revolving fund loans should act as gap financing <br /> for loans being made by a private lender. For each bank participating in the program, a Lender <br /> Agreement would be signed with the City. This agreement would outline the general <br /> requirements of the RLF program and what the expectations are of the bank in partnering with <br /> the City. A Participation Agreement would also be created for individual loans, providing <br /> specific details and responsibilities for each deal. The lender would prepare the note and <br /> collateral documents and the City would issue a check from the RLF to purchase a participation <br /> in the note. The lender would be responsible for disbursing the loan funds and collecting <br /> payments for both the City and private portions of the loan. Monthly payments would then be <br /> submitted to the City. <br /> Associate Planner Bachler indicated that the bank would also be responsible for doing the <br /> necessary underwriting for the entire loan package. Since banks are risk-averse, if an applicant <br /> meets a bank's underwriting requirements the City can be confident about the risk level <br /> associated with the loan. The City should primarily rely on the financial criteria used by the <br /> participating bank to screen loan applications. Additional recommendations included: <br /> • Require that a minimum of 50 percent of the project be privately financed. <br /> • Many projects would likely not receive a high score using the City's Grading and Report <br /> Card for public financing proposals, as this tool is largely focused on redevelopment <br />