Commission updates terms of city loans to LIPCO, sets temporary 0% interest period

The Economic and Community Development Commission approved a resolution to update the terms of the City—s standing loans to the La Crosse Industrial Park Corporation (LIPCO). Staff presented the resolution and commissioners voted to adopt the updated terms unanimously.

Julie, a city staff member, summarized the history and current status of the loans: the city—s outstanding principal balance to LIPCO is $550,000 and, historically, interest payments had been tied to prime, which led to a high recent interest burden. Staff reported cumulative interest-only payments on the loans of approximately $707,176 (as summarized in staff materials) and said the current documents are outdated and in need of clean-up.

Under the approved resolution, the loans will carry 0% interest for the next three years starting March 1 to free LIPCO cash flow for project development. After one year of the 0% period, LIPCO will begin principal payments of $4,500 quarterly; if LIPCO secures a qualifying project within three years it will transition to a 3% interest rate amortized over a 10-year payoff schedule. If no suitable project is in place by March 2028, staff said LIPCO would transfer liquid assets to repay the city.

Staff also noted the resolution removes CDBG as a source for these internal loans and consolidates repayment responsibility into the city—s industrial park sinking funds. Tim Cabot, LAADCO executive director and Lipco representative, was available for questions; none were raised on the record. Gina moved approval; the motion received a second and passed by unanimous voice vote.

Staff said the revised terms are intended to give LIPCO flexibility to pursue a new project while preserving a path to repayment and reducing short-term interest burden.