PROGRAM: Small business loans up to $500,000 with a flexible rate and term dependent on project.  The typical loan is $100,000 or less.

 

TYPE OF ASSISTANCE: Loans funded through the Community Development Block Grant (CDBG) program.

 

MAXIMUM AMOUNT: $500,000

 

INCENTIVES:  Flexible rates and terms, technical assistance.

 

ELIGIBILITY: Projects must create or retain jobs or help develop, rehabilitate, or revitalize the adjacent neighborhood.  Must be used for fixed assets related to retail, commercial and industrial uses.

 

CRITERIA: Project must create or retain jobs, 51% of all jobs must be filled by persons from low-moderate income households, federal prevailing wage rates apply, environmental review covering entire project must be performed.  A limited number of projects that eliminate slum or blight or provide benefits to low-moderate income communities will be approved.  All CDBG guidelines must be met.  A minimum of 55% of the loan must finance actual project costs (hard costs) or purchase land, buildings or machinery and equipment.  Funding Agreement required for each loan.

 

ELIGIBLE/
INELIGIBLE USES: A minimum of 55% of the loan must finance actual project costs (hard costs) or purchase land, buildings or machinery and equipment.  Eligible uses include purchase of land, land improvements, purchase of building, building renovation, building construction, leasehold improvements, machinery and equipment with a minimum useful life of 5 years, certain professional and closing fees, and refinancing of existing debt as part of a larger project.  Ineligible uses include personal investments, financial institutions, social service agencies, private clubs, religious organizations, and venture capital companies.

 

RATES/TERMS: Typically at prime fixed, may be lower if warranted.  Maximum terms: 20 years for real estate acquisition and 10 years for construction, rehabilitation, machinery, or equipment purchase.  May be prepaid without penalty.

 

APPROVAL: Loans up to $500,000 approved by the Department of Community Development, over $500,000 approved by City Council.

 

PROGRAM EXAMPLES: BioStart, Esquire Theatre