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Committee task force recommends major changes to Vernon County Economic Development Loan Fund policy
Summary
A loan task force proposed changing interest-rate policy (to 60% of prime with 3% floor and 10% ceiling), tightening collateral and co-signer rules, narrowing nonprofit eligibility, and eliminating the Community Development Loan category; the committee asked for an updated draft in February.
Members of the Economic Development Loan Fund task force presented proposed revisions to the policy manual and the committee directed the task force to return with an updated draft in February.
The task force recommended changing the loan interest-rate structure to 60% of prime with a 3% floor and a 10% ceiling for start-up, equipment and real-estate loans; if collateral is not available, the policy would require a co-signer (close family member). The task force suggested a 10-year maximum amortization with a five-year balloon, and recommended considering a five-year maximum where no collateral exists. They also recommended eliminating the Community Development Loan category for municipalities, reasoning that municipalities already have access to low-interest loans; developers working on housing or child-care projects could still apply under other categories. The task force asked the committee to specify whether “non-public recreation facilities” should be treated differently and to emphasize that nonprofits may apply only for housing and child-care initiatives under the program.
Katie Helseth moved for the task force to make the recommended changes and bring an updated draft to the February meeting; Gail Muller seconded and the motion passed unanimously. Committee members said the revisions aim to focus limited county loan funds on housing and child-care projects and on small businesses that need gap funding.
