5. EDSR 10-11-2010REQUEST FOR ACTION
TO ITEM NUMBER
Economic Develo ment Authority 5.
AGENDA SECTION MEETING DATE PREPARED BY
Economic Development October 11, 2010 Catherine Mehelich, Director of
Economic Develo ment
ITEM DESCRIPTION REVIEWED By
Consider Resolution 10-05 Authorizing Transfer from the EDA Tim Simon, Finance Director
DYED Fund to the Micro Loan Fund REVIEWED BY
ACTION REQUESTED
Adopt Resolution 10-05 Authorizing Transfer from the EDA DYED Fund to the Micro Loan Fund
BACKGROUND/DISCUSSION
In 2003 the City of Elk River received a $200,000 MN Investment Fund grant from the MN Dept of
Trade & Economic Development (DYED) for the purpose of providing a business expansion loan to
Sportech, Inc. DYED required the funds to be administered in a separate account for auditing purposes
during the 7-year loan term
The loan has recentlybeen paid in full and staff recommends that the EDA authorize a transfer of the
loan proceeds to the Micro Loan Fund to support future business start-ups and expansion projects.
DYED has indicated that there are no federal requirements that the EDA must adhere to, other than
using the funds for economic development. The City's award of these state and federal resources
provides significant benefit to the business community and leverages the City's investment in community
and economic development projects.
FINANCIAL IMPACT
The Micro Loan Fund has a current balance of $823,372.18. The amount to be transferred from the
DIED Fund is $214,493.16.
ATTACHMENTS
^ EDA Resolution 10-05
ACtlOtl Motion by Second by Vote
Follow Up
N:\Departments\CommunityDevelopment\Economic Developmnt\Micro Loan Fund\ 10.11.10 EDA Action Requested.doc
RESOLUTION 10 - 05
A RESOLUTION OF THE ECONOMIC DEVELOPMENT AUTHORITY
A RESOLUTION AUTHORIZING A TRANSFER FROM THE EDA DTED
FUND TO THE MICRO LOAN FUND
WHEREAS, in Apri13, 2003 the City of Elk River was awarded a $200,000 Small Cities
Development Program MN Investment Fund grant from MN Department of Trade &
Economic Development (DTED) for the purpose of providing a loan to Sportech, Inc. for
business expansion, and,
WHEREAS, DTED approved the City's request through Resolution 03-20 designating the
Economic Development Authority (EDA) as the Local Development Organization and the
EDA established the DTED Fund on July 21, 2003, and,
WHEREAS, DTED has completed its final audit of the fund, and Sportech, Inc. has
repaid the loan in full, and,
WHEREAS, The EDA has reviewed the request to transfer the DTED Fund for the
purpose of financing community and economic development needs and determined it to be
a sound financial practice; and,
WHEREAS, It has been determined that an amount $214,493.16 will be transferred out of
the DTED Fund to provide additional community and economic development funding
through the policy and guidelines of the Micro Loan Fund;
NOW, THEREFORE, BE IT RESOLVED that the Economic Development Authority
of the City of Elk River makes the following transfer of funds from the DTED Fund:
Micro Loan Fund $214,493.16
Passed and adopted this 11th day of October 2010.
Ron Touchette, EDA President
ATTEST:
Catherine Mehelich, Executive Director
N:\Departments\Community Development\Economic Development\Resolutions\2010\EDADTEDtransfer.doc