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Committee reviews plan for Keystone Grant-funded revolving loan fund for downtown improvements, tables item for solicitor review
Summary
Members discussed creating a revolving loan fund using Keystone Grant proceeds to support downtown building improvements and housing; staff noted prior loan repayments created available funds, recommended underwriting partners, and the committee tabled the item for legal review and further work.
The committee considered a proposal to establish a revolving loan fund that would use proceeds from a Keystone Grant to lend for community development projects, including building and housing improvements and infrastructure in the downtown area.
Staff said repayments from an earlier loan to the Uptown Theater had replenished a similar fund, and the state Department of Community and Economic Development indicated the borough could redeploy the funds consistent with the original grant purpose. Staff urged identifying a partner to evaluate applicant creditworthiness; the solicitor also signaled there might be more latitude in program deployment that the committee should explore.
Finance director Barb Leanti proposed setting a modest interest rate to incentivize applicants: "We set them the interest rate ourselves ... I set the interest rate at 3% because I was trying to be generous and to entice people to come in," she said, noting market interest rates were much higher. Committee members discussed collateral requirements (mortgage or subject property) and whether 3% was sufficiently competitive but supported exploring the option further.
The committee voted to table the proposal for one month so staff can consult with the solicitor, find a credit-evaluation partner and return with a more complete policy recommendation. No final program terms or a vote to establish the fund were recorded in the transcript.
