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EDC Minutes April 2, 2014 Page 2 of 5 Associate Planner Bachler stated that it was recommended that the program have clearly defined goals so that businesses can easily evaluate whether a project meets the City’s objectives. The bankers thought the City should prioritize projects that would result in a direct financial benefit to the City, such as through increases in property value, and that well - established businesses and industries should be targeted. The application process should also be transparent and the City should set a goal of completing the evaluation of loan requests within 30 days. In order to achieve this goal, a special committee made up of councilmembers and staff may need to be formed to review applications. Associate Planner Bachler reported that the maximum loan amount should be between $50,000 and $75,000, with an interest rate of two or three percent. The private lender would set the term length, but the City could still set a maximum number of years for a loan term. If the City wanted to focus on projects with shorter amortization periods, it may want to set 10 years as the maximum term length. Eligible projects should include land and building acquisition, real property improvements, commercial façade improvements, and fixed asset equipment. Associate Planner Bachler explained that revolving fund loans would act as gap financing for loans being made by a private lender. He provided details on how such a partnership between the City and a private bank would be structured. Local bankers recommended that a minimum of 50 percent of any project be privately financed. It was also advised that RLF projects be exempt from evaluation using the City’s Grading and Report Card as this tool is largely focused on redevelopment projects. Chair von Holtum asked if the RLF interest rate could be changed over time in response to fluctuations in the private lending market. Associate Planner Bachler responded that the City could decide to change the interest rate at a point in the future. He recommended that the City try to maintain a consistent interest rate, as this would help in efforts to market the program and would reduce confusion amongst applicants. Chair von Holtum asked if a business applied for revolving loan funds whether their financial records would be included in the public record. He commented that this would be a deal breaker for most businesses. Commissioner Radziej questioned how the City would ensure timely approval of RLF loan applications if final approval is required by the EDA, which only meets quarterly. Associate Planner Bachler commented that this was an area of concern identified by staff and that further research needed to be done on how the approval process could be structured to make it as streamlined as possible. Commissioner Heikkila suggested that the City could establish a short window of time each year when applications for revolving loan funds are accepted. This would allow the City to more easily coordinate the different approvals required for an application.