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514/2018 Economic development tool for cities dissolved-StarTribune-com <br /> WEST METRO <br /> Ecommilic development tool for cifiges <br /> dissolved <br /> The Twin Cities Community Capital Fund didn't reach its full <br /> potential before it was done in by the collapse of the capital <br /> markets. <br /> By MARIA ELENA BACA Star Tribune NOVEMBER 1,ZOIO—10:36PM <br /> An economic development tool for metro-area cities has fallen victim to the economy. <br /> Officials in two dozen Participating cities and other andues;are deciding their next step <br /> after the board of the Twin Cities Conimunity Capital Fund(TCCCF)voted to dissolve <br /> in late September. <br /> Since TCCCF was spun off from the statewide Minnesota Community Capital Fund <br /> (MCCF)in 2005,it has worked with cities and private banks to connect small businesses <br /> with gap to to allow them to invest in property and murpment.Participants included <br /> Blame,Brooklyn Park,Woodbury,Wacoma,Belle Plain and others,plus Hennepin <br /> County and Great River Energy <br /> TCCCF originated the loans,then turned thern Around for sale in the secondary capital <br /> markets,sindlar to the way banks sell mortgage notes.It enabled city economic <br /> development directors to leverage investments of$50,000 to$200,000 into loans ten <br /> times that amount. <br /> "It would just kind of give us a little higher playing field than a corninunity that was not <br /> part of the program,"said Curt Larson,Blaine's economic development specialist. <br /> In January 2008,for example,Brooklyn Park used the fund to help Master Transfer Co. <br /> secure a$542,000 gap to to reach the$1.17 million needed to buy a 5-acre parcel to <br /> store and service its fleet.The city connection to capital was the key that allowed the <br /> trucking company to locate in Brooklyn Park,said Chad Master,the company's of <br /> operating officer. <br /> 'the statewide fund remains solvent,said Scott Martin,TCC CF president and O.It <br /> started up debt-free,thanks to a$250,000 Blanifin Foundation grant Metro cities have <br /> been encouraged to join the Minnesota fund. <br /> Blaine is planning to do so and so VAR Brooklyn Park said business developer Amy <br /> Baldwin,chairwoman of the Mkinesom fund's board of directors. <br /> Until the market's collapse in the fall of 2008,the Twin Cities fund originated 14 loans <br /> ranging from$200,000 to$1.5 million—about$7.5 million around the metro area, <br /> Martin said.The proceeds of a start-up to fiorn participating cities and an origination <br /> fee tacked onto each to kept the fund solvent. <br /> Its last loan,$1.5 on to a Minneapolis private school,was processed in June 2009. <br /> "The business model was based upon access to capital,with capital coming from large <br /> financial institutions,mostly Wall Street-based institutions that were readily buying <br /> to as investments bemuse they would perform,"Marvin said. <br /> "The model doesn't work when the secondary market isn't buying loans." <br /> No loans meant no revenue,Martin said.Rather than spending down its cash on hand, <br /> the board voted at its Sept.28 meeting to shut down. <br /> Martin hoped to close the books by the end October.Cities will be refunded all but <br /> about 5 percent of their original investments. <br /> http:llwww,startribune-com/eoonomic-development-tool-for-cities-dissolved/106494163nc=y&page=i 112 <br />