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HomeMy WebLinkAbout1991-05-13 91-205 ORDER{aanml ACBon Data May 6, 1991 - hanw. 91-305' Approving and Adopting Business Development Item/Subject: Loan Program Iapammle Department: Community & Economic Development Dept. Commusand The proposed Business Development Loan Program would consolidate the Bangor Center Revitalization Area Facade Loan Pool Program, Bangor Center Revitalization Loan Program And Bangor Economic Incentive Revolving Loan Program into one loan program which would provide loan assistance for all of the activities presently eligible for funding under the loan programa it would replace. The major proposed differences are n increase in the average loan amount limitation from $5,000 to $1,500 per job created or retained with a maximum possible amount of $10,000 per job; an increase in total maximum loan amount which could be approved by the Loan Review Committee from $15,000 to $100,000; and loanassistance for facade improvements would be eligible only as part of a building improvement project which would eliminateallcode violations. A Memorandum providing a more detailed summary of the proposedBusiness Development Loan Program is attached. Specific program guidelines are available upon regues . pn�m.nr HW +fifimam's ammmnu:lha� kee q /L .CtE7J b mawgr AmomatedInfarmabsn:p�ti rnMary� �t &IdTm Approval: im� �� F,rFwa wmirc�[ar UPI Approval: . 'Cib saaaw Introduced For - - ®panaee - []FineReading Pw,of_ . 1:1 Ra/emal �. 91-205 Aeogosdb Camdor Bragg, May 13, 1991 r CITY OF BANGOR (TITLE,) Orberf_..._Approv+Rg and. Adoptiag Business _Development ._....... By Ow Guy Coaaat of the Oft ofBasFm. ORDERED, THAT WHEREAS, the primary objective of the Housing and Community Development Act of 1974, as amended, is the development of viable urban communities, by providing decent housing and a suitable living environment and expending economic opportunities, principally for persons of low- and moderate -Income; and WHEREAS, consistent withthis primary objective, the City of Bangor has established goals to create and retain jobs, principally for low- and moderate -income persona, through the use of Community Development Block Grant funds to stimulate and leverage private investment, alleviate physical and economic distress, and expand tax revenues; and WHEREAS, the City Council of the City of Bangor has previously approved and adopted the Bangor Economic Incentive Revolving Loan program, the Bangor Center Revitalisation Loan Program and Bangor Center Revitalization Area Facade. Loan Pool Program to accomplish such goals and objectives; and WHEREAS, the City Council of the City of Bangor s determined that the goals and objectives of said Act and the City's Community Development Program would best be served by the consolidation of the above previously adopted Loan programs; HOW, THEREFORE, BE IT ORDERED BY THE CITY COUNCIL OF THE CITY OF BANGOR THAT the Business Development Loan Program, a copy of which is on file in the office of the City Clerk, is hereby approved and adopted; and _ BE IT ALSO ORDERED THAT the Business Development Loan Program hereby supersedes and replaces the Bangor Economic Incentive Revolving Loan Program adopted by Council Order 83-342, the Bangor Center Revitalisation Loan Program adopted by Council Order 84-218 antl the Bangor Center Revitalization Area Facade Loan pool Program established by Council. Order 83-201. 91205 In City Council May U, 1991 O R D E R Passed Title, IL I`� Appr ng and Adopting 2 iness itY Clerl...................................... Development Loan Program ..... I .............................. G. —&u ...... Aapedto .... co .Lan WHAT ARE WE ASKING YOU TO DO? Volmecertoorgmdzearounddre Town Meetin IMHmivelnymrmmm"V! Ifyoutell us you can help (whichwe hope yourwilll), we will owed you our simple Tow to" equalizer kit complete with everything you need including "talking poffi&', couple media releme&letter-to-the-editor,andpostem. Asammmunityorgani r,weaskymm: 1) Ask your selecemWenunegnrs W place discussion of the resolution on their board<mmcil meeting agenda for adoption by July 1. 2) Two weeks (if possible) before the meeting, put posters up in strategic locations around town to publicize and encourage attendance m the meeting. 3) Invite your friends, neighbors, clergy, teachers, merchants, community leaders, etc. to apmd the meeting and speak on behalf of the resolution. - 4) One week before the meeting, mail a mediu release to your local press asking Nem to apmd and report on the meeting. An "optional exW' is to ask locat maidmts to write Ittmrs-to-Ncedimron behalfafNe resolution. NOTE: Munkipd ofidals, town mmmem and ebndos A, racogmasweeideleve trzuowned hJmme- tion w Weiown Mating LtitiYive aW,ugM W appart Wertmlmion. flurspring Town Meeting Initiative newakna will be mailed in two April to oven 5,000 citeew and elected officials wound the note. We are wndting4hoody with as near ttlaonm& wwdbes as possible in towns and cities scows We uses a ask for Weir support out ph ement of We resoluawn on Wer mating agenda. And, the following have already adopted the resolution - Auburn, Biddeford, Hollis, Preachville, Smithfield and New Sheronl Congressional Record. Congressman Tom Andrews makes floor speech on behalfofMe resolution and repots the resolution and his remarks into the Congressional Record. His comments commend the resolution to the U.S. Congress, Maine Legislature & municipalities, and municipalities& state legislatmesamand the country. Press Conference. Immediately following (areficipared) resolu- adopBmbySure Legulamre, a press conference will be held at the State House with resolution m sponmrs to aumunce adoption by the Iegulatme end kick -of the Town Meeting Initiative. Mid Aptil - Municipal Resolutions. Maine towns and rides discuss and July 1 adopt resolutions. September Congressional Resolution. Enemmgedby Maine municipal and Sous Uldslahue resolutions, Maine mngressioml delegation introduce ajoint congressional "Reinvest in Hometown Anted®" resolution calling on the president to change national priorities. Note: Simultaneous strategies to promote and publicize the resolution include working with the National Council of State Legislators, National League of Cities, and U.S. Conference of Mayors tourge resolution adoption by municipalities and erme legislatures nationwide; presenmtimts& resolution adoption rryuests to local organimtions; ongoing mediacampaign; public hearings and workshops; publications and signature ad. WHAT ARE WE ASKING YOU TO DO? Volmecertoorgmdzearounddre Town Meetin IMHmivelnymrmmm"V! Ifyoutell us you can help (whichwe hope yourwilll), we will owed you our simple Tow to" equalizer kit complete with everything you need including "talking poffi&', couple media releme&letter-to-the-editor,andpostem. Asammmunityorgani r,weaskymm: 1) Ask your selecemWenunegnrs W place discussion of the resolution on their board<mmcil meeting agenda for adoption by July 1. 2) Two weeks (if possible) before the meeting, put posters up in strategic locations around town to publicize and encourage attendance m the meeting. 3) Invite your friends, neighbors, clergy, teachers, merchants, community leaders, etc. to apmd the meeting and speak on behalf of the resolution. - 4) One week before the meeting, mail a mediu release to your local press asking Nem to apmd and report on the meeting. An "optional exW' is to ask locat maidmts to write Ittmrs-to-Ncedimron behalfafNe resolution. NOTE: Munkipd ofidals, town mmmem and ebndos A, racogmasweeideleve trzuowned hJmme- tion w Weiown Mating LtitiYive aW,ugM W appart Wertmlmion. flurspring Town Meeting Initiative newakna will be mailed in two April to oven 5,000 citeew and elected officials wound the note. We are wndting4hoody with as near ttlaonm& wwdbes as possible in towns and cities scows We uses a ask for Weir support out ph ement of We resoluawn on Wer mating agenda. And, the following have already adopted the resolution - Auburn, Biddeford, Hollis, Preachville, Smithfield and New Sheronl TOWN MEETING INITIATIVE of the Peace Economy Project Thornhurst Road, Falmouth, Maine 04105 - (207) 781-3947 - 839-6258 QTTITZIOXIM The purpose of the Town Meeting Initiative is to provide a form for public and elected official education, dialogue and action an sentiment priorities as alocal issue and responsibility. Itupon cubnors and local governments to participate N federal budget decisions and economic conversion and diveraifimtim planning to promote and meet the challenges rad opportunities of reduced military spending and, capons municipal "Remvesl N Hometown Amoica"" reclaims. The resoludon is a simple but strong retirement urging that the federal government re-establish partnerships with both local and stem governments so that the process of reinvestment nt our states, towns and cities can begin. It expressos citizen and local elected officials' concern about the well-being of our communities, car mem, our nation and the world =it calls an Congress and the Presidxl to work and vale for new national priorities. Spadffcally,NerewludonaskstbatCmgressmdth President: (1)Rerogorzegsatlhe ecurity ofmrcaumry u dependent on the wellbeing of car xonomy, environment and people and to use the opportunity of dramatic improvements m relations between the Fast and West to reduce military spending proportimme to reduced military guests: (2) RMirxd fedeal tax dollars saved toward such crltiral domestic proposes as education, convicts - meant] protection, infrastructure, housing, health are, social services, transportation, and employment and job raining, as well as; deficit reduction; and (3) Assist those industries, workers and communities most affected by military cutbazks to make the transition from military to civilian activities. Scheduled for March 1991, the Town Meeting Initiative was postponed to avoid public debate on reflood priorities becoming a debate on the Wfwar. Now Nat the war is over, it u time to revive the Town Meeting Initiative and address the very and need for federal Vwv em m make a mmmlunenl m a domestic agenda that defime security to include the welfare of am economy and citizenry. Hegiming in mid-April, municipal officials will be asked on place resolution discussion on mi nidpd muncillboad] meetings for adoption by July 1. RESOLUTION STRATEGY & TIMELINE Mid April Maine Legislature Resolution. Joint Resolutimco-sponsored by Same Melody Leader Clark (D), House Spcaker Marin (D), Swam Minority Leader Caltill R), and Assistant Houser Minority Leader Maumo(R) will come before the 115th Maine Legislature. Some specific benefits Mainers could receive include: doubling the number ofchildren In Head =Eat tun; p atIfa rt millenoverfouryeats intoe revolving fund for wastewater treatment plants and over$25 millionsyenfmto=Amnment,mergy cemervat!onprogmms;giving Med!midto 0,000 more Malacca and «nial assistance to 10,7W low income renters; enabling 11,500 more women, int m and children to receive food and milk under the WIC Program and tripling the - nuber ofchildren wed forwlmam now eligible forsubsidized child care; buyingnewbuses d begiimingwmk on a (min at Basten; and giving up m 7,000 more Manners employment and job training. Ofjobs lost, the greatest impact will be felt by Maine's defense -dependent industries, workers and communities. Fossedal thmealfected by milimryspendingtuts make a successful transition to ommemial production andjobs will require a fedmaily mppened local economic conversion, diversiftcationmMadj imempmras. While there are distinctobsmcles to convening highly miliary-depandent producma, workers and communities to civilian activities, there also are distinct opportunities. Mktemiewswithlomldefemecon(mmonmdlabor,anumberoferea(iveand Profitable commercial possibilities were discussed For Bath Iron Works, theme possibilities Include to erch machineant ships, BeaOng power plants, sections ofdams and tunnels, off -shore mining vehicles,y. demed meet for bridges, double hull tankers, paand pef processing arecyling The studys correlations are clew. A sustained transfer of funds from the military budget o it, domestic Forstmann will yield long -tens benefits for Maine's economy, environment and people. nom mmaamg continued research to afmlyu the nature and extent of mnemic dependency on the military and projected impact of defense spending cuts and economic needs of defense -d "e1O1me" blesou oe srrengmenerr m more fully meet the ependenfworkersandcommuniiies. And federal policieammppon economically, envimmead lly, and socially sound and needed commemmi productsaml investment shouldbepromosed. This s" was conducted to document We possibilities fm Risser if the mi!itmy badger ;reduced pmlmdmmh W tNmM embey, flown and We savings users not Indy to reduu We Ndget reach but rtti,wMa1 In domatk Pmerms.nesndYwaepeepvelby Pmploymemgewaecb Asv ,m Ndepdendeuf,mn rLtftnomic consulting fi which specializes to warbEing the imp.n of numerous, polities on We U. S. economy. ne Pane Pommy pryM gives xpeclal thanks to We qudys co-aymms sed to E;Ewmm McKenm; We Saaa Phuring Ofgca; them, pelnnmmfa of PEuutim,, Pnvbonmem, TOmPorta im, ISM, Human Se:vicn, Housing,ni a Emomic and GmmuNb Uevelcpmmt; local defame mnaeclm; labor, buthess, eudemia, W other govmun„ offichns ani community harass for War wvpemfio" and MimnxN providing valuable Np, for ads mount ]he Peas Economy PhIrect of We Melee henPura, out Makee Deese Gn¢alge is a ampory me PRE4®, smewiAeecof dsignelro edmere udngage fm/utlame mMeheledofllciJxuren eramieWim afnatiwWsnudbpiiaatli,andfheif impxYm Mu'ce TheRojzx ix xarYing with 1ws1Ma, uMmhy,/eMr, govumnae(,edAepJe,la"I sommWitiv,eM o(EermmeG'MmiexronKef rhe Malleagnol�mglmrybWgebudoyq:pputia roreinvaf AAmaiss. A SHIFT IN FEDERAL SPENDING: WHAT THE PEACE DIVIDEND CAN MEAN TO MAINE A Rtymt for the Pea" Economy Project prepared by Employment Research Associates - 1990 Co-spun+"N by. For Copies of the study vaWar MaheA Clo more Information, nates Mune Coumil Nf]mrd,q MCN¢CevelapmmtFw,MaYw Susie Schwepp"F Pea stay Prm,jou jecl Endorsed by. FnlmwuW,Mthonsuth,MW Meme Cmrfermce ofMeyan eine01105 (30])]81-39C] EXECUTIVE SUMMARY A 7% manual shift in federal spending from the military budget to key civilian programs would bring over 100%more federal dollars into Maine. More jobsand higher mcomomd revenues wouldbegenerawd. Term of thousands of children and young people would be better educated; low income Mainers would have improved housing, nmri0on and health care; and theirs, land and water of our slaw would be purer and healthier. This vial an of Monies future is not rhetorical but a real possibility if local citiurm call upon our notices leaders to change federal policy and spending priorities. This is the basic conclusion ora sandy, 'A Shift in Federal Spending; Nkat the Peace Dividend P Mean to Maine, which awlyus a 7%annual across the based cut in military spending between 1991-1994 and Mnvestmrnt of these GAeml dollars in domestic programs. Nationally, a 7%annual cut in federal military spending over this form -year period would yield an annual average of $59 billion in savings that could be spent for the domestic programs chosen by the study's co-spomors for federal reinvestment - education, enviromnent, infrastructure, transportation, housing, social and health services, civilian research & development and employmentandjobtraining. Maine's percentage share ofline $58 billion for these programs would result in a net increase in federal expenditures averaging over $200 million each year. There would bean annual average of$166 million less spent on militarywmracb and alarms and $380 million more spent for these non-military programs. The economic, social and environmental benefits result from We factors. First, the shift in federal spending priorifies considered in this study would result in more fedend dollars coming to Maine because Ne state receives a higher share of federal funding from these civilian programs than from spending on the military. Second, spending on these civilian programs nimuUtes a higher level of emnomicactivity. This is contrary to widespread opinion thmbigh militarybudgetsare good for Maine. There would be 8,200 more civilian and 5,200 fewer milimy,jobs for a mitannued gain of 3,000 ewjobs. The largest meas ofjob gain would be in ¢duration and health rareas Noe two areas would receive substantial incretion in funding. There would also bean average increase in Maine's Gross Sate product of $146 million per year. Personal dspesable income would go up an annual average of over $60 million resulting in increased State sales tax revenues. related to ownership, operation, and management of the property, including repayment of the Business Development Loan. M exception may be made in a case in which the ability of the property to produce sufficient revenues appears possible, but marginal. In such circumstances, an applicant's strong financial condition and ability to repay may be used to support a finding of acceptable risk. Activities commenced or completed prior to Loan approval are not eligible for program financial assistance. Borrower must agree to follow the recommended work schedule established by the Director and Committee and when applicable, the Loan Review Committeeto complete the work satisfactorily. This program will be initially funded with the balance of unexpended funds originally budgeted for the three programa to be replaced and the balance of funds in the Bangor sconomie Incentive Revolving Loan fund. RWrp 9.' _ related to ownership, operation, and management of the property, including repayment of the Business Development Loan. M exception may be made in a case in which the ability of the property to produce sufficient revenues appears possible, but marginal. In such circumstances, an applicant's strong financial condition and ability to repay may be used to support a finding of acceptable risk. Activities commenced or completed prior to Loan approval are not eligible for program financial assistance. Borrower must agree to follow the recommended work schedule established by the Director and Committee and when applicable, the Loan Review Committeeto complete the work satisfactorily. This program will be initially funded with the balance of unexpended funds originally budgeted for the three programa to be replaced and the balance of funds in the Bangor sconomie Incentive Revolving Loan fund. RWrp To qualify for a BDLP Loan, the project to be assisted must be located within the City of Bangor, must create and/or retain jobs principally for low- and moderate -income persons, or must comply with such criteria as may be established by the Department Of Housing and Urban Development for satisfaction of the requirements that activities benefit low- and moderate -income persons. Business Development Loans may be used to finance the following types of activities and related costs, a. The acquisition, construction, reconstruction, rehabilitation, expansion, and/or installation of Public facilities, site improvements, or utilities; b. The acquisition, construction, reconstruction, rehabilitation, expansion and/or installation of commercial, mixed-use or industrial buildings and structures and other commercial or industrial real property, capital equipment and improvements; C. The removal of architectural barriers which restrict the mobility and accessibility of elderly or handicapped persons. d. The acquisition, construction, reconstruction, rehabilitation, expansion, and/or installation of capital equipment if the same are to be a part of the real estate upon which they are located; e. Working capital or operational funds; or f. Such other assistance to private, for-profit entities as may be deemed necessary or appropriate to carry out an economic development project; A project financed with a Business Oevelopment Loan musts a. He able to support a determination that the project is necessary or appropriate to meet program Goals; and b. Provide a measurable impact in terms of the jobs created and/or retained principally for low- and moderate -income persons, or to remove architectural barriers for handicapped persons in places of employment or buildings of public access, and, where applicable, bring properties into conformance with applicable City Codes; Generally a Business Development Loan shall not be made with respect to a business -owned property if the property clearly cannot produce sufficient revenues to satisfy all expenditures ADEEDA ITEM ii MEM _ 91-205 TO: City Council FR: Rod McKay, Community Development Director RE: Summary of proposed Business Development Loan Program DATE: April 25, 1991 The proposed Business Development Loan program would consolidate the Bangor Center Revitalization Area Facade Loan pool Program, Bangor Center Revitalization Loan Program and Bangor Economic Incentive Revolving Loan Program into one loan program which would provide loan assistance for all of the activities presently eligible for funding under the loan programa it would replace. The major proposed differences are an increase in the average loan amount limitation from $5,000 to $7,500 per job created or retained with a maximum possible amount of $10,000 per job; an increase in total maximum loan amount which could be approved by the loan Review Committee from $75,000 to $100,000; and loan assistance for facade improvements would be eligible only s part of a building improvement project which would eliminate all code violations. The goals of this program are: To create and retain jobs, principally for low- and moderate -income persons, leverage private investment, alleviate physical and economic distress, and expand tax revenues through the use Of Community Development Block Grant Entitlement funds for the acquisition of real property for economic development purposes; for the acquisition, construction, reconstruction, rehabilitation and installation of public facilities, site improvements, and utilities; for the acquisition, construction, reconstruction, rehabilitation and installation of commercial or industrial buildings and structures and other commercial er industrial real property improvements; and to provide assistance to private, for-profit entities, when the assistance in necessary to carry out an economic development project. The City Of Bangor Department of Community and Economic Development, through its Director, is responsible for the administration of the Program, including its marketing and management, the screening of applicants, the conduct of initial interviews with loan candidates, consultation with the Director of Community Development to determine if projects are in conformance with the regulations of the Community Development Block Grant Program and are eligible activities under this program and all other applicable federal, state and local statutes, regulations, and ordinances, as may be amended, preparation of applications and related documents, and presentation of eligible project applications to the Loan Review Committee for consideration and approval. For approved loans, the Department monitors the project to ensure that it is in compliance with all requirements of the Program and the federal, state and local laws, statutes, or 2 ordinances governing the Program. The Department ie also responsible for the servicing of all Program loans, including the collection and accounting of payments. The Department also keeps and maintains records for each loan under this Program for all .income and expenditures in regards to the Business Development Loan Progress Food. The Loan Review Committee considers and approves or disapproves all loan applications, and decides on all question. concerning eligibility including all questions as to possible conflicts of interest. A BOLP Loan may be made with respect to an eligible project located within the City limits of the City of Bangor. Projects must provide a measurable Impact in terms Of the jobs created and retained principally for low- and moderate -income persons. On the average, loans pursuant to this Program must leverage private investment at a minimum ratio of Three Dollar. ($3.00) in private funds to each One Dollar ($1.00) Provided through the BOLP. The Loan Review Committee is required to render a written justifica- tion for any loan in which the private investment does not satisfy said 3 to 1 ratio. The maximum loan shallnot exceed Ten Thousand Dollars ($10,000) for each job generated and/or retained. Due to the limited amount of City Community Development funds, the maximum amount of a BDLP Loan is established as $100,000 unless otherwise approved for specific projects by separate City Council Order. The interest rate for a Business Development Loan to a far -profit Borrower would be established by the Committee. The Committee would be required to consider debt service payments that balance a maximum rate of return to the Business Development Loan Program and the economic health of the project financed. Con- sideration would he given to the purpose of the Loan and the collateral securing the same in establishing the term of the loan. A Business Development Loan involving a non-profit Borrower would be at an interest rate of 3% per year. The term of the Loan would be established by the Committee for a period not to exceed twenty (20) years. must, To qualify for a Loan under this Program, an applicant A- Provide suitable proof of ownership, Or, for lessees, written permission from the owner and suitable proof of a leasehold interest for any property to be improved; b. Evidence Adequate capacity to repay the Loan; - C. Have paid all City property taxes and/or lease fees due and outstanding. related to ownership, operation, and management of the property, including repayment of the Business Development Loan. An exception may be made in a case in which the ability of the property to produce sufficient revenues appears possible, but marginal. in such circumstances, an applicant's strong financial condition and ability to repay may be used to support a finding of acceptable risk. Activities commenced or completed prior to Loan approval are not eligible for Program financial assistance. Borrower must agree to follow the recommended work schedule established by the Director and Committee andwhenapplicable, the Loan Review Committee to complete the work satisfactorily. This program will be initially funded with the balance of unexpended funds originally budgeted for the three programs to ba replaced and the balance of funds in the Bangor Economic Incentive Revolving Loan fund. RGMIrp 3 To quality for a BDLP Loan, the project to be assisted must be located within the City of Bangor, must create and/or retain Jobs principally for low- and moderate -income persons, or must comply with such criteria as may be established by the Department Of Housing and Urban Development for satisfaction of the requirements that activities benefit low- and moderate -income persons. Business Development Loans may be used to finance the following types of activities and related costs: a. The acquisition, construction, reconstruction, rehabilitation, expansion, and/or installation of public facilities, site improvements, or utilities; b. The acquisition, construction, reconstruction, rehabilitation, expansion and/or installation of commercial, mixed-use or industrial buildings and structures and other commercial or industrial real property, capital equipment and improvements; C. The removal of architectural barriers which restrict the mobility and accessibility of elderly or handicapped persons. d. The acquisition, construction, reconstruction, rehabilitation, expansion, and/or installation of capital equipment if the same are to be a part of the real estate upon which they are located; G. Working capital or operational funds; or f. Such other assistance to private, for-profit entities as may be deemed necessary or appropriate to carry out an economic development project; A project financed with a Business Development Loan most; a. Be able to support a determination that the project is necessary or appropriate to meet Program Goals; and b. Provide a measurable impact in terms of the jobs created and/or retained principally for low- and mcderate-income persons, or to remove architectural barriers for handicapped persons in places of employment or buildings of public access, and, where applicable, bring properties into conformance with applicable City Codes; Generally a Business Development Loan shall not be made with respect to a business -owned property if the property clearly cannot produce sufficient revenues to satisfy all expenditures ordinances governing the Program. The Department is also responsible for the servicing of all Program loans, including the collection and accounting of payments. The Department also keeps M maintains records for each loan under this Program for all income and expenditures in regards to the Business Development Loan Program Fund. The Loan Review Committee considers and approves or disapproves all loan applications, and decides on all questions concerning eligibility including all questions as to possible conflicts of interest. A BDLP Loan may be made with respect to an eligible project. ' located within the City limits of the City of Bangor. Projects must provide a measurable impact in terms of the jobs created and retained principally for low- and moderate -income persons. On the average, loans pursuant to this Pregram must leverage private Investment at a minimum ratio of Three Dollars ($3.00) in private funds to each One Dollar ($1.00) provided through the SDLP. The Loan Review Committee is required to tender a written justifica- tion for any loan in which the private investment does not satisfy said 3 to 1 ratio. The maximum loan shall not exceed Ten Thousand Dollars ($10,000) for each job generated and/or retained Due to the limited amount of City Community Development funds, the maximum amount Of a SDLP Loan is established as $100,000 unless otherwise approved for specific projects by separate City Council Order. The interest rate for a Business Development Loan to a for-profit Borrower would be established by the. Committee. The Co®ittee would be reguired to consider debt service payments that balance a maximum rate of return to the Business Development Loan Program and the economic health of the project financed. Con- sideration would he given to the purpose of the Lose and the collateral securing the same in establishing the term of the loan. A Business Development -Loan involving -a nonprofit Borrower would be at an interest rate of 3% per year. The term of the Loan would be established by the Committee for a period net to exceed twenty (20) years. must: To qualify for a Loan ander this Program,an applicant a. Provide suitable proof Of ownership, or, for lessees, written Permission from the owner and suitable proof of a leasehold interest for any prePerty to be improved; b. Evidence adequate capacity to repay the Loan; C. Have paid all City property taxes and/or lease fees due and outstanding. 2 ordinances governing the Program. The Department is also responsible for the servicing of all Program loans, including the collection and accounting of payments. The Department also keeps M maintains records for each loan under this Program for all income and expenditures in regards to the Business Development Loan Program Fund. The Loan Review Committee considers and approves or disapproves all loan applications, and decides on all questions concerning eligibility including all questions as to possible conflicts of interest. A BDLP Loan may be made with respect to an eligible project. ' located within the City limits of the City of Bangor. Projects must provide a measurable impact in terms of the jobs created and retained principally for low- and moderate -income persons. On the average, loans pursuant to this Pregram must leverage private Investment at a minimum ratio of Three Dollars ($3.00) in private funds to each One Dollar ($1.00) provided through the SDLP. The Loan Review Committee is required to tender a written justifica- tion for any loan in which the private investment does not satisfy said 3 to 1 ratio. The maximum loan shall not exceed Ten Thousand Dollars ($10,000) for each job generated and/or retained Due to the limited amount of City Community Development funds, the maximum amount Of a SDLP Loan is established as $100,000 unless otherwise approved for specific projects by separate City Council Order. The interest rate for a Business Development Loan to a for-profit Borrower would be established by the. Committee. The Co®ittee would be reguired to consider debt service payments that balance a maximum rate of return to the Business Development Loan Program and the economic health of the project financed. Con- sideration would he given to the purpose of the Lose and the collateral securing the same in establishing the term of the loan. A Business Development -Loan involving -a nonprofit Borrower would be at an interest rate of 3% per year. The term of the Loan would be established by the Committee for a period net to exceed twenty (20) years. must: To qualify for a Loan ander this Program,an applicant a. Provide suitable proof Of ownership, or, for lessees, written Permission from the owner and suitable proof of a leasehold interest for any prePerty to be improved; b. Evidence adequate capacity to repay the Loan; C. Have paid all City property taxes and/or lease fees due and outstanding. AGEPDA ITEM #1- MEMO. 91-205 TO% City Council FRz Rod McKay, Community Development Director RE: Summary Of Proposed Business Development Loan Program DATE: April 25, 1991 The Proposed Business Development Loan Program would consolidate the Bangor Center Revitalization Area Facade Loan Pool Program, Bangor Center Revitalization Loan Program and Bangor Economic Incentive Revolving Loan Program into one loan program which would provide loan assistance for all of the activities presently eligible for funding under the loan programs it would replace. The major proposed differences are an increase in the average loan amc nt limitation from 55,000 to $7.,500 per job created or retained with a maximum possible amount of $10,000 per job; an increase in total maximum loan amount which could be approved by the Loan Review Committee from $75,000 to $100,000; and loan assistance for facade improvements would be eligible only as part of a building improvement project which would eliminate all code violations. The goals of this program are; To create ardi retain jobs, principally for low- and moderate -income persons, leverage private investment, alleviate Physical and economic distress, and expand tax revenues through the use of Community Development Block Grant Entitlement funds for the acquisition of real property for economic development Purposes; for the acquisition, construction, reconstruction, rehabilitation and installation of public facilities, site imProvmsentso and utilities; for the acquisition, construction, reconstruction, rehabilitation and installation of commercial or industrial buildings and structures and other commercial or industrial real property Improvements; and to provide assistance to private, for-profit entities, when the assistance is necessary to carry out an economic development project. The City of Bangor Department of Community and Economic Development, through its Director, is responsible for the administration of the Program, including its marketing and management, the screening of applicants, the conduct of initial interviews with loan candidates, consultation with the Director of Community Development to determine if projects are in conformance with the regulations of the Community Development Block Grant Program and are eligible activities under this Program and all Other applicable federal, state and local statutes, regulations, and ordinances, as may be emended, preparation of applications and related documents, and presentation of eligible project applications to the Loan Review Committee for consideration anA approval. For approved loans, the Department monitors the project to ensure that it is in compliance with all requirements of the Program and the federal, state and local laws, statutes, or