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Blackduck authorizes application for USDA-backed revolving loan funds via Beltrami Electric for City Hall repairs
Summary
Council approved a resolution authorizing application through Beltrami Electric for USDA revolving loan/grant funds to finance roughly $460,000 in City Hall repairs; staff said Beltrami would be the intermediary and that any city cash contribution (discussed up to $100,000) would improve the application score but that the city would ultimately receive loan proceeds rather than direct grants.
The Blackduck City Council approved a resolution authorizing staff to support an application through Beltrami Electric for USDA-linked revolving loan/grant funds to help finance repairs to City Hall.
Staff told the council the project is roughly $460,000. "Beltrami Electric is hoping to gain" the REDLG-style assistance from USDA, staff said, which could include a maximum grant to Beltrami of up to $300,000 and a required local match (Beltrami’s own contribution) of 20% to seed a revolving loan fund. Staff clarified that the city itself would be the ultimate borrower on any funds Beltrami passes through: "all of the monies we’re getting through Beltrami Electric are a loan; none of them are a grant to the city," the staff speaker said.
Council discussed two options: for Beltrami to apply for the full $460,000 (with $300,000 as a grant to Beltrami and the remainder structured as a loan), or for the city to contribute cash — staff discussed hypotheticals including a $100,000 city contribution — which would reduce the loan portion Beltrami would need to pass on to the city and could improve the application score. Staff also described differences between the city’s restricted RLF created in the 1990s and its unrestricted RLF funds and said any city contribution would require a resolution and parameters for repayment.
Questions from councilors focused on whether the resolution would bind the city to a repayment amount (staff said it would not), the unknown interest rate on non-grant portions (staff said it would likely not exceed prime, but final terms depend on USDA and Beltrami’s program), and the scheduling needs of Beltrami Electric (the utility’s board meets on the 18th and asked the city for guidance to proceed with its application).
A motion to approve the resolution authorizing application for funding was made, seconded and carried with no recorded opposition. Staff emphasized that the resolution authorizes application only and does not obligate the city to provide cash; if the council later decides on a specific city contribution the matter would return for further action.
