Submitted By
Tammie Grossman, Director of Development Customer Services
Reviewed By
LKS
Agenda Item Title
Title
A Resolution Approving the Draft Section 108 Loan Guarantee Program Application and the Section 108 Substantial Amendments to the Program Year 2015 Action Plan and Program Year 2015-2019 Consolidated Plan for Release and Public Comment
End
Overview
Overview
This resolution would approve and release a draft Community Development Block Grant (CDBG) Section 108 Loan Guarantee Program application for a 30-day public comment period along with a required amendedment to the current Consolidated Plan. This would allow the Village to create a business loan fund in the amount of $3 million to assist local businesses and increase jobs available to low- and moderate income persons.
Body
Staff Recommendation
Approve the resolution.
Fiscal Impact
The Village receives an annual entitlement to roughly 1.5 million dollars of CDBG grants to support low- and moderate-income persons, reduce blight, and recover from natural disasters. This application would allow the Village to create a loan pool of up to five times that annual amount. At this time, the staff is proposing to create a fund of three million dollars, which would be secured by the Village's annual entitlement. The Section 108 application to HUD is expected to have positive economic benefits to the Village by assisting businesses and creating and/or retaining jobs for low- and moderate income persons.
The Village understands that if the borrowers from this Section 108 loan fund fail to make timely payments and the Village therefore fails to make a required payment on its note, HUD could deduct that payment from the Village's CDBG Line of Credit. In accepting this loan guarantee, the Village would pledge all HUD entitlement grants made to the Village, or those for which the Village may become eligible, as security for the loan guarantee.
Background
The Board of Trustees has adopted economic d...
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