6.4. EDSR 05-08-2006ITEM # 6.4.
ver
MEMORANDUM
TO: Economic Development Authority
FROM: Catherine Mehelich, Director of Economic
DATE: May 8, 2006
Development /"
SUBJECT: Consider Adoption of Amended Micro Loan Fund Policy &
Application
Attachments
• Micro Loan Fund Policy & Application, Amended May 2006
Background
At its September 28, 2005 meeting, the EDA Finance Committee discussed the level of
financial assistance provided to manufacturing companies and provided recommendations to
the EDA for amendments to the Micro Loan Fund Policy. The EDA reviewed a first draft
of the amended policy at its February 13, 2006 meeting.
Recommendation
The attached policy includes amendments discussed at the EDA's February 13, 2006
meeting and input received from the HRA and HPC. Staff recommends that the EDA
consider adoption of the amended Micro Loan Fund Policy & Application.
Op o! I
E1
River
The Light Industrial Hub of the Northwest Metro
Economic Development
Micro Loan Fund Policy & Guidelines
And Application
Amended: May 2006
Amended: June 2004
Adopted: September 1999
City of Elk River
Economic Development Division
13065 Orono Pazkway
Elk River, MN 55330
763.635.1040
ELK RIVER ECONOMIC DEVELOPMENT
MICRO LOAN FUND POLICY & GUIDELINES
PURPOSE
The Economic Development Authority fox the City of Elk River (EDA) recognizes
the need to stimulate private sector investment into manufacturing facilities and
equipment in oxdex to create new jobs, boost productivity and retain existing jobs fox
local residents. Additionally, the need exists to encourage investment in the
expansion and/or rehabilitation of commercial and retail buildings in oxdex to
maintain the economic viability of Elk River's Downtown District . Subsequently,
the purpose of this program is to provide low interest, long-term (i.e. gxeatex than
one year) loans as incentives for industrial development within the City of Elk River
and to encourage commercial and retail business owners in the Downtown District
to rehabilitate their existing buildings.
II. LOAN PROGRAMS
In oxdex to meet the economic and community development objectives of the EDA,
two distinct loan programs exist within the Micro Loan Fund to promote business
growth in Elk River.
Industrial Incentive Program
Purpose: The purpose of the Industrial Incentive Pxogxam is to encourage
industrial and high technology business development that supports
the tax base and brings quality jobs to the city.
Amount: Up to $100,000 of secondary financing not to exceed 20% of the
pxojectcost
Equity: Must have private-sector commitments fox 50% of the project cost.
Boxxower must provide 10% ox more of project financing.
Rate: Fixed; 2 points below the lowest prime rate published in
the Wall Street Journal the day the loan is closed, ox 3%, whichever is
gxeatex.
Term: Financing with a balloon payment in 5-years. The balloon payment
must not be longer than the balloon payment of the participating
bank. Loans may be amortized up to the following limits:
20-years on real estate uses;
10-years on equipment uses.
Extension: In the event that the Boxxower is unable to obtain conventional
fmancing to replace the Micro Loan at the end of five years, the loan
may be extended up to two additional years at a market rate of
interest.
Micro Loan Fund Policy & Guidelines Page 2 of 14
Amended May 2006
Cxitexia: 1. Boxxowex must be an industrial ox high technology firm and create
one new full-time job for each $20,000 loaned within 2 years. Said jobs
must pay a minimum wage of $10.00 per hour excluding benefits
required by law. Loans in excess of $75,000 shall meet the attached
City of Elk River Business Subsidy Policy fox the creation of new jobs
at a minimum wage of $15.00 per hoax excluding benefits required by
law, as well as a 5-year location requirement.
In the case where the multiple sources of public financing axe requested
(e.g. Micro Loan and Tax Increment Financing) job creation goals shall
not be double-counted.
2. Boxxowex must comply with the provisions of the city's Industrial
and Business Park zoning ordinances as applicable.
Downtown Rehabilitation Financing Program
Purpose: The Downtown Rehabilitation Financing Program is available to
business and property owners in the Downtown District (DD) fox the
rehabilitation and restoration of their buildings.
Amount: Up to $75,000 of secondary financing (not to exceed 40% of the
project cost.
Equity: Must have private-sector commitments fox 50% of the project cost.
Boxxowex must provide 10% ox more of project financing.
Rate: Fixed at 2%.
Term: Financing with a balloon payment in up to 5-years. Loans may be
amortized up to the following limits:
20-years on real estate uses;
10-years on equipment uses.
Extension: In the event that the Boxxowex is unable to obtain conventional
financing to replace the Micro Loan at the end of five years, the loan
may be extended up to two additional years at a market rate of
interest.
Cxitexia: 1. At a txtinuttum, 20% of Micro Loan dollars must be used fox the
improvement of the building facades.
2. Rehabilitation loans in the Downtown District axe exempt from
job creation and wage goals since the loan amount does not exceed
$75,000 and does not qualify as a business subsidy by state law.
3. Boxxowex must be located in the Downtown District (DD)
(see attached map).
Micro Loan Fund Policy & Guidelines Page 3 of 14
Amended May 2006
~~ ~ ~~~.
~~ ~
xov
~,
0
J
s
~~
4
5
5~
A
VIE
ADD ~-
/i LJ
Location Map N
'.. City of
El -,-,
R1VeP Case Number: DOWNTOWN DISTRICT (DD)
III. USES
1. Permitted Fund Uses:
a. Building construction
b. Land acquisition
c. Machinery
d. Furniture, fixtures, and equipment (FF&E)
e. Renovation and modemizadon of buildings
f. Exterior renovation of retail, commercial and industrial buildings
g. Public infxastrucmre needed fox economic development expansions
h. Investment real estate with a minimum of 50% of the space pre-leased
2. Ineligible Fund Uses:
a. Expenditures for the construction and/or renovation of residential units
b. Working capital
c. Refinancing of existing debt
d. Inventory
IV. BUSINESSES ELIGIBILITY
Any project meeting the above criteria, and located ox proposed to be located within
the city limits of Elk River as defined by this program, may be eligible fox an
Economic Development Micro Loan as further defined herein:
• Business must be afox-profit corporation, partnership, ox sole
proprietorship.
• Business must be a rmall burinerr as defined by the Small Business
Administration (SBA).
• Business must have a positive net worth.
• Religious, political, and pomogxaphic enterprises axe not eligible to use
the Economic Development Micro Loan Fund.
V. MICRO LOAN FUND TERMS & CONDITIONS
1. Loan Structure
All Economic Development Micro Loans will be structured as participation loans and
will be serviced by the project's primary lending institution. Such an arrangement
allows fox the central distribution and collection of funds and simplifies the financing
process fox all parties involved. A participation agreement will be signed by the
borrower, primary lender and the EDA. The agreement will include the following
provisions, among others:
If Borrower does not meet the job and wage goals specified in the Subsidy
Agreement, the interest rate will change to 2 points above the participating
bank's rate, effective from the two year anniversary of the loan closing.
Upon subsequent achievement of the jobs and wage goals, the interest rate
will revert back to the rate when the loan was originated, effective from the
date of attainment of the job and wage goals.
Micro Loan Fund Policy & Guidelines Page 4 of 14
Amended May 2006
• If Borrower defaults on the loan, the EDA will collect all further payments
during the default based on a pro-rata basis with the participating bank
excluding the distribution of proceeds resulting from the foreclosure on
collateral.
The EDA may require additional agreements to be signed by the borrower (i.e.
security agreement, personal guazantees, subsidy agreement).
2. Simultaneous Micro Loans
The simultaneous use of different Micro Loan Fund Programs by any one borrower
ox fox any one project is prohibited.
3. Call of Loan
A loan shall become due and payable in full if a business relocates outside of the city
of Elk River prior to the maturity date of the loan.
4. Late Payment Charge
A late payment chazge of 8% of the installment amount may be enforced.
VI. REGULATION FOR NEW CONSTRUCTION AND IMPROVEMENTS
All buildings which public funds will be used for construction ox renovation axe to
be brought into conformance with city ordinances and state building codes. Repairs
may include the following systems and portions of real property:
a. Mechanical heating, plumbing, and electrical
b. Structural; including the facade of the structure and energy related
improvements.
c. Hook-up to city services (i.e. water, sewer)
d. ADA (Americans with Disabilities Act) improvements
VII. LOAN SECURITY AND GUARANTEES
Applicant must be able to secure the loan by providing the EDA with a minunum of
a subordinate mortgage upon the building and/ox assets or other approved collateral.
Applicant must demonstrate the financial means to repay the loans, as determined by
the Economic Development Authority.
Whenever possible, personal guarantees will be made part of any loan agreement.
VIII. TIMING OF PROJECT EXPENSES
No project should commence until the Elk River Economic Development Authority
has approved the loan application. Any costs incurred prior to the approval of the
loan application axe generally not eligible expenditures.
No building construction should commence until the required Ciry permits are
secured.
Micro Loan Fund Policy & Guidelines Page 5 of 14
Amended May 2006
The applicant will be responsible fox all legal, recording, and other fees required fox
protection of a security interest in the loan, payable by anon-refundable 1%
processing fee, which is paid at the time of application.
IX. PROCEDURAL GUIDELINES FOR APPLICATION AND APPROVAL
1. All applicants shall first contact a primary lending institution to determine if
additional equity is needed, and if so, how much.
2. The applicant and the primary lender shall then meet with City Staff to obtain
information about the Micro Loan program, discuss the project, and obtain
application forms.
3. The applicant shall complete and submit an application form to the City, along
with a processing fee of 1% of the loan request. (The fee is used to cover
processing expenses and will be returned only if application is denied.) The
applicant must provide evidence of their ability to meet the equity requirements
or provide a letter of commitment for conventional financing from the primary
lending institution.
4. The application will be reviewed by the City staff to determine if it conforms to
all City policies and ordinances and to consider the following:
a. The availability and applicability of other governmental giants and/or
loan programs.
b. Whether the proposed project will result in conformance with building
and zoning codes.
c. Whether it is desirous and in the best interests of the public to provide
funding fox the project.
5. The EDA Finance Committee and EDA Commissioners will review each
application in terms of its consistency with the goals of the City's
Comprehensive Plan and Economic Development Strategic Plan and in relation
to the project's overall impact on the community's economy. Rehabilitation
Loan applications will also be reviewed by an HRA member in conjunction with
the EDA Finance Committee.
They will also evaluate the project application in terms of the following:
a. Project Design -Evaluation of project design will include
review of proposed activities, time lines and a capacity to implement.
b. Financial Feasibility -Availability of funds, private involvement, financial
packaging and cost effectiveness.
• Appropriate ratio of private funds to Micro Loan funds.
• Sufficient cash flow to cover proposed debt service as
demonstrated by financial statements and projections.
blicxo Loan Fund Policy & Guidelines Page 6 of 14
Amended May 2006
• Business must show a positive net worth.
• Letter of Commitment from applicant pledging to complete the
project during proposed project duration, if the loan application
is approved.
• Letter of Commitment from other Financing sources stating
terms and conditions of their participation in the project if
applicable.
• Sufficient collateral.
c. All other information as required in the application and/ox additional
information as may be requested by the Economic Development
Authority.
d. Project compliance with all city codes and policies.
e. Program Objectives - In addition to quality job and wage
creation/retention requirements, the applicant must meet all Micro Loan
Fund criteria and demonstrate how the proposed activities will meet at
least one of the following objectives:
• The project contributes to the fulfillment of the city's approved
and adopted economic development and/ox redevelopment
plans.
• The project prevents ox eliminates slums and blight.
• The project increases the local tax base.
• The project brings a structure into compliance with an existing
building code violation.
6. A written request fox an extension shall be accompanied by a copy of current
financial statements and a $500 upfront processing fee. The processing fee is
used to cover processing expenses and will be returned if request is denied. The
application fox an extension beyond the original term should include a letter of
denial from a conventional lender. Refinancing will not be allowed solely for the
purpose of reducing the interest rate due to lower market interest rates.
7. The EDA Finance Committee will recommend the approval, denial, or request a
resubmission. A recommendation from the Finance Committee will be
forwarded to the EDA for final action.
Micro Loan Fund Policy & Guidelines Page 7 of 14
Amended May 2006
X. LOAN POLICY REVIEW
The above criteria will be reviewed on an annual basis to ensure that the policies
reflected in this document axe consistent with the economic development goals set
forth by the Ciry.
X1. RIGHT OF REFUSAL
The Elk River Economic Development Authority may deny any project which it
deems inappropriate according to the guidelines established in this document.
XII. COMPLIANCE WITH MN BUSINESS SUBSIDY LAW
Each company receiving assistance in excess of $75,000 from the EDA Micro Loan
Fund shall be subject to the provisions and requirements set forth by Minnesota
State Statute 116J.993 and the attached City of Elk River Business Subsidy Policy.
Micro Loan Fund Policy & Guidelines Page 8 of 14
ilmended May 2006
ELK RIVER ECONOMIC DEVELOPMENT
MICRO LOAN FUND APPLICATION
I. CONTACT INFORMATION
Legal Name of Business:
Address:
City /State /Zip
Contact Person(s)
Business Phone
Home Phone
Check One: Proprietor Corporation Partnership
Social Security No.
Federal ID #
State ID #
II. NATURE OF LOAN REQUEST
Which Micro-Loan Program axe you applying for?
Industnal Incentive Pxogxam
Rehabiliation Financing Program
Amount Requested: $ Total Project Cost: $
Type of project:
New construction fox a start up business.
New construction fox an existing business.
On site expansion
Equipment purchase
Remodeling: (circle one) Commercial /Retail /Industrial
Other
Elk River Economic Development Authority Page 9 of 14
Micro Loan Fund Application
Revised June 2004
Please give a brief summary of your business and its products ox service:
Please give a brief summary of the project:
Please describe how this loan will impact your project:
III. FINANCING
Project Costs
Land
Site improvements
Buildings (attach plans & costs)
Equipment/ Machinery /Fixtures
(attach list and estimated costs)
Remodeling
Industrial Inventory/Working Capital
Other (attach description)
Total Costs
Comments:
Elk River Economic Development .Authority
Micro Loan Fund Application
Revised June 2004
Page 10 of 14
Proposed Sources of Financin
SOURCE NAME
Bank Loan
Bank Loan
Other Private Funds
Applicant Contribution
Other
Fed Grant/Loan
State Grant/Loan
EDA Micro Loan
Tax Increment Financing
Tax Abatement
Total Financing
Collateral Assignments
Description of Collateral
TERMS AMOUNT
Lien
Position
To Bank 1
To Bank 2
To Private Sources
To Other Sources
To Federal Govt
To State
To EDA Micro Loan
Value of Collateral
Elk River Economic Development Authority
Dlicxo Loan Fund Application
Revised ]une 2004
Page ll of 14
Book Value Cost Existing Liens
Land $ $ $
Buildings $ $ $
Machinery & Equip. $ $ $
Other $ $ $
Other $ $ $
IV. JOB & WAGE GOALS
Present # of Employees Total Payroll
Jobs To Be Created*
Please provide the followine information on robs you expect to create Within 2-years.
ob Title
Number
of Jobs Average
Hourly
Wage
Annual
Salary Axe the Jobs
Permanent ox
Temporary? Expected
Hiring
Date
*If loan is fox job retention only, please explain in Business Plan.
Program Objectives
(Check all that apply)
The project contributes to the fulfillment of the city's approved and adopted
economic development and/or redevelopment plans.
The project prevents or eliminates slums and blight.
The pxojectincxeases the local tax base.
The project brings a structure into compliance with an existing building code
violation.
IV. PROJECT CONTACTS
Attorney
Name
Elk River Economic Development Authority Page 12 of 14
bucxo Loan Fund Application
Revised June 2004
Address
Phone
Accountant
Name
Address
Phone
Financing Sources (lenders partners. etc
Name
Address
Phone
Name
Address
Phone
Parent Company
Name
Address
Phone
Others
Name
Address
Phone
Name
Address
V. ATTACHMENTS CHECK LIST
Please attach the following:
A) Written Business Plan:
Elk River Economic Development Authority Page 13 of 14
Micro Loan Fund Application
Revised June 2004
1. Description of Business
2. Ownership
3. Management
4. Date Established
5. Products/Services
6. Future Plans
B) Financial Statements fox Past Two Years
C) Financial Projections for Two Years
D) Resume of Owner/Management
E) Personal Financial Statements of Proprietor, Partners,
Guarantors
F) Letter of Commitment from Applicant Pledging to Complete
During the Proposed Project Duration
G) Letter of Commitment from the Other Sources of Financing,
Stating Terms and Conditions of their Participation in
Project
H) Fee (1% of amount of loan request).
VI. AGREEMENT
I / We certify that all information provided in this application is true and correct to the best
of my/our knowledge. I / We authorize the City of Elk River and the Finance Committee
to check credit references and verify financial and other information. I / We agree to
provide any additional information as may be requested by the City and the Finance
Committee.
APPLICANT SIGNA
DA
Elk River Economic Development Authority Page 14 of 14
Miao Loan Fund Application
Revised June 2004
Gty o!
Elk
River
Business Subsidy Policy
Amended & Adopted:
May 2006
Original Adopted:
Housing & Redevelopment Authority November 25, 2002
City CouncIl November 25, 2002
Economic Development Authority December 9, 2002
City of Elk River
Economic Development Division
13065 Orono Pazkway
Elk River, MN 55330
763.635.1040
CITY OF ELK RIVER
POLICY AND PROCEDURES RELATING TO
THE USE OF BUSINESS SUBSIDIES
I. PURPOSE
For the purpo rer of thin document, the term "City"shall include the Elk Diver City Council, Economic Development
Authority, and Housing and Redevelopment Authonty.
The purpose of this policy is to establish guidelines and cxitexia regarding the use of business
subsidies, such as tax increment financing (TIFF, tax abatement, and other business subsidies
fox private development projects within the City of Elk Rives. This policy shall be used as
cxitexia fox providing subsidies, in addition to the requirements and limitations set forth by
provisions of Minnesota State Statute 116J.993 (MN Business Subsidy Law), and the City's
policy and guidelines of the particular form of subsidy.
These guidelines shall be used in processing and reviewing applications requesting business
subsidy assistance. The fundamental purpose of business subsidies in the City is to
encourage desirable development or redevelopment that would not otherwise occur "but
fox" the assistance provided through business subsidies.
It is the intent of the City to provide business subsidies, as well as other incentives that the
City may deem appropriate, at the shortest term required fox the project to proceed. The
City reserves the right to approve ox reject projects on a case-by-case basis, taking into
account established policies, specific project cxitexia, and demand on city services in relation
to the potential benefits to be received from a proposed project. Meeting policy guidelines
ox other criteria does not guarantee the award of a business subsidy. Furthermore, the
approval ox denial of one project is not intended to set precedent fox approval ox denial of
another project.
Whenever possible it is the City's intent to coordinate the use of business subsidies with
other applicable taxing juxisdicdons.
II. DEFINITION OF "BUSINESS SUBSIDY"
The following types of assistance having a value in excess of $25,000 axe defined as a
"business subsidy" within the MN Business Subsidy Law:
• State and local government agency giants;
• Contributions of personal property, seal property, or infrastructure;
• The principal amount of a loan that exceeds $75,000 at rates below those
commercially available;
• Reductions or deferrals of taxes or fees;
• Guarantees of any payment under any loan, lease, or other obligation; and,
• Preferential use of government facilities.
City of Elk River Business Subsidy Policy
Amended May 2006
111. PUBLIC PURPOSE OBJECTIVES OF BUSINESS SUBSIDIES
In accordance with the MN Business Subsidy Law, the City will consider using business
subsidies to assist private development projects to achieve one or more of the following
public purpose objectives:
• To retain local jobs and/ox increase the number and diversity of jobs that offer
stable employment and/ox attractive wages and benefits.
• To enhance and diversify the City of Elk River's tax base.
• To encourage additional unsubsidized private development in the area, either
directly ox indirectly through "spin off' development.
• To achieve development on sites which would not be developed without
business subsidies assistance.
• To remove blight and/or encourage development of commercial and industrial
areas in the city that result in higher quality development ox redevelopment and
private investment.
• To offset increased costs of development of specific properties when the unique
physical characteristics of the site may otherwise preclude private investment.
• To create opportunities for the construction, operation and maintenance of
affordable housing.
IV. GENERAL POLICIES FOR THE USE OF BUSINESS SUBSIDIES
A. Business subsidy assistance will be provided from the City, on a "pay-as-you-go"
note method, to the developer if the business subsidy is tax increment financing ox
tax abatement. Requests fox up front fmancing will be considered on a case-by-case
basis.
B. A developer requesting business subsidy assistance must demonstrate, to the
satisfaction of the City, sufficient cash equity investment in the project as required
within the City's policy for the particular form of subsidy.
C. Business subsidy assistance will not be provided in circumstances where land and/ox
property price is demonstrated by the County Assessor to be in excess of fair market
value. This would normally be where the acquisition price is more than 10% in
excess of market value.
D. A developer must be able to demonstrate to the City, ox, if applicable, to the
underwriting authority, a market-demand fox a proposed project.
E. Business subsidy assistance will not be used in cases where the subsidy would create
an unfair and significant competitive financial advantage over other similar projects
in the area.
F. Business subsidy assistance will not be used fox projects that would place
extraordinary demands on city infrastructure and services.
City of Elk River Business Subsidy Policy
Amended May 2006
G. If requested by the City the developer shall provide adequate financial guarantees to
ensure completion of the project, including, but not limited to: minimum assessment
agreements, letters of credit, cash escrows, and personal guaranties.
H. Each developer must be able to demonstrate to the City's satisfaction, an ability to
construct, operate, and maintain the proposed project based on past experience,
general reputation, and credit history.
If requested by the City, ox its consultants, the developer shall provide sufficient
market, financial, environmental, ox other data relative to the successful operation of
the project.
I. Projects receiving business subsidy approval from other affected taxing jurisdictions
will be more favorably received by the City.
V. GUIDELINES FOR COMMERCIALIINDUSTRIAL BUSINESS
SUBSIDIES
A. Business subsidies will not be used for retail or service businesses unless it is a
redevelopment project that demonstrates that it will result in a substantial increase in
tax base and a significant improvement in quality employment.
B. The project must be consistent with the City's Comprehensive Plan, Land lire Plan,
and Zoning Ordinances.
C. The project must result in the retention of existing jobs that would be lost "but for"
the proposed development ox result an increase and diversification in local jobs.
Business retention jobs will be considered on aone-fox-one match to job creation
only in cases where job loss is specific and demonstrable in accordance with the MN
Business Subsidy Law.
D. Specific wage and job goals will be determined by the City giving consideration to
the particular form of the subsidy, nature of the development, the purpose of the
subsidy, local economic conditions and similar factors. The recipient will have up to
two years from the benefit date, which is the date that the recipient receives the
subsidy, to meet the job and wage goals established by the City.
E. The minimum wage fox a job to be considered a new ox retained job shall be $15.00
per hoax, exclusive of benefits required by law. Deviations from the job and wage
goal may be considered fox projects that will result in a significant increase in tax
base. Deviations less than the wage floor will be considered on a case-by-case basis
and in accordance with the requirements of the MN Business Subsidy Law.
F. Business subsidies will not be used for commercial/industrial projects that have a
history of inconsistent compliance with applicable environmental rules and
regulations.
City of Elk River Business Subsidy Policy
Amended May 2006
VI. GUIDELINES FOR REDEVELOPMENT AND RENOVATION
BUSINESS SUBSIDIES
In accordance with the MN Business Subsidy Law, the following forms of financial
assistance related to redevelopment and renovation axe not a "business subsidy":
A. Assistance provided for the sole purpose of renovating old ox decaying building
stock ox bringing it up to code, provided that the assistance is equal to ox less
than 50 percent of the total cost;
B. Assistance for pollution control or abatement;
C. Redevelopment when the recipient's investment in the purchase of the site and
in site preparation is 70 percent ox more of the assessor's current year's estimated
market value.
VII. SUBSIDY APPLICATION PROCESS AND PROCEDURE
A. Application for business subsidies shall be made on the City's forms fox the
particular type of assistance. The application fox business subsidies shall request
information required within the City's policies on the particular form of subsidy
including but not limited to; a detailed description of the project; a preliminary site
plan; the amount of business subsidy requested; the public purpose of the project;
the number and types of jobs to be created; the wages and benefits to be paid new
employees; and verifiable funding sources and uses.
B. Following a review by appropriate City Staff the application shall be referred to the
either the Economic Development Authority, ox Housing and Redevelopment
Authority, fox recotntnendation to the City Council for denial or approval.
C. Before granting a business subsidy that exceeds $100,000, the City shall provide
public notice and hold a hearing on the subsidy unless a hearing and notice on the
subsidy is otherwise required by law.
VI11. SUBSIDY AGREEMENT AND REPORTING REQUIREMENTS
Each company receiving a business subsidy shall be subject to the subsidy agreement and
reporting provisions and requirements set forth by the MN Business Subsidy Law and
summarized below:
A. Progress Reports
The recipient shall file a report annually fox two years after The receiving the
subsidy or until all goals set forth in the subsidy agreement have been met, which
ever is later. Reports shall be completed using the format drafted by the State of
Minnesota and shall be filed with the City's Economic Development Division no
later than March 1 of each year for the progress made the previous year.
City of Elk River Business Subsidy Policy
Amended May 2006
B. Maintain Facility
The recipient agrees to maintain and operate its facility at the site where the
subsidy is used for a period of five years after the date the subsidy is provided.
C. Failure to Comnlv
Businesses failing to comply with the subsidy agreement will be subject to fines,
repayment requirements at the rate established within the MN Business Subsidy
Law, and be deemed ineligible by the State to receive any loans ox grants from
public entities fox a period of five years.
City of Elk River Business Subsidy Policy
mended May 2006