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HRA/EDA discusses options to capitalize a revolving loan fund; no decision taken
Summary
Board members discussed establishing a revolving loan fund (RLF) to support business and housing needs, reviewing EDA and USDA options, Davis-Bacon implications and whether to run separate housing and business pools; no formal action was taken.
Speaker 1 outlined two primary paths to capitalize a revolving loan fund: applying for federal Economic Development Administration support (which would require a match and likely trigger Davis-Bacon prevailing-wage rules) or using the USDA Intermediary Relending Program, which involves borrowing a pot of money at a low interest rate (Speaker 1 said the interest is 1%) for a 10- or 20-year term.
Board members discussed whether to create separate funds for business lending and housing rehabilitation, minimum and maximum loan amounts, underwriting parameters, inspection and whether owner-occupied rehab belongs in the same program as development loans. Speaker 3 suggested researching other counties' models and existing HRDC and city programs for sample policies. No motion was made; staff will collect examples and return with a proposal.
