Aldermen Approve $30,000 Special-Benefit-District Revolving Loan for C Street Holding Corp.; City Attorney to Draft Loan Documents

The Rutland City Board of Aldermen voted June 2 to approve a $30,000 loan from the City’s Special Benefits District (SBD) revolving loan fund for C Street Holding Corp. The loan was recommended by a subcommittee of the RRA and DRP; terms recommended were 5% fixed interest for 15 years.

Why it matters: The SBD revolving loan fund provides low-interest financing to property owners within the special benefits district to support property rehabilitation and downtown investment. The loan application and subcommittee minutes were included in the board packet; the policy governing the fund was last amended May 15, 2023.

Discussion and conditions: Board members asked legal staff how the loan would be structured because the requested $30,000 covers work on three different buildings, and the SBD policy anticipates a single building per loan. City Attorney LaChance confirmed the city can structure documents to provide the necessary subordinate lien positions across three properties but said doing so requires additional drafting. Aldermen requested that the final loan documents reflect the agreed approach to collateral and lien priority before closing.

Board action: The board suspended rules to take up the item and then approved the loan by voice vote. The aldermen also clarified that final loan execution will require documentation prepared by the city attorney and reviewed before the city signs.

Implementation: City staff said the city attorney will draft loan documents that reflect a subordinated position consistent with the policy and the loan committee’s recommendation. The loan will proceed once the documents are prepared and executed.

Ending: The board approved the loan in principle and directed staff to complete the legal and closing paperwork to effect the loan.