 Department of Planning & Community Development
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
- Program Description
- Objectives
- Eligibility Criteria
- Eligible Uses
- Loan Terms
- General Policies
- Loan Application
- Loan Making
- Low and Moderate Income Limits
- Contacts
download a printable copy of the Montpelier Business Loan Fund Guidelines (4 pages,
40 KB, Adobe PDF 
)
)Program Description
The Montpelier Business Loan Fund (MBLF) seeks to foster a strong and vital downtown in Montpelier by making capital available to new enterprise developments that are unable to obtain sufficient financing through existing commercial lending institutions. The program is administered by the City of Montpelier Department of Planning & Development.
Objectives:
The overall objectives of the Montpelier Business Loan Fund are to:
- Encourage the creation of new community-based businesses that contribute to the economic mix and quality of life in downtown Montpelier.
- Provide financing to new enterprise developments that are unable to obtain sufficient financing through existing lending institutions.
- Strengthen and promote existing businesses.
- Encourage the full utilization and accessibility of existing buildings.
- Create or retain job opportunities that are available to low and moderate income persons.
- Create of retain jobs that pay a livable wage.
- Attract business to the area which contribute to the economic diversity, create job opportunities for low and moderate income persons, enhance the quality of life, and which have a good chance of success.
Eligibility shall be limited to any private corporation, partnership, cooperative, or proprietorship located in or relocating to the City of Montpelier. Eligible businesses must also be located in or relocating to the Designated Downtown District. Enterprises must have an acceptable business plan and have demonstrated access to and use of appropriate technical assistance. Sufficient financing must be unavailable through conventional lending sources.
A business must also:
- operate with all necessary municipal, state, and federal permits;
- have a history of compliance with applicable regulations and permits;
- demonstrate site control;
- be current on local, state, and federal tax payments and applicable municipal service charges;
- not place unusually high demands on municipal services;
- its principals have not been convicted of a felony within the past three years; and
- the loan must result in the creation or retention of jobs primarily available to low and moderate income persons. The loan amount shall not exceed $5,000 for each full time equivalent job created or retained.
- The new or expanded business must not displace housing.
This Loan Fund has been established to fill gaps in other business financing sources. Loan funds may be used to start, expand, strengthen, or relocate business. Eligible uses include but are not necessarily limited to:
- Purchase of inventory, equipment, materials, supplies, etc.
- Operating capital.
- Remodeling or renovations.
- Marketing expenses.
- Accessibility improvements.
Loan Terms:
- Maximum Loan Amount: $15,000.00, subject to the availability of funds
- Term: 0-10 years, negotiable. Initial loan payments may be deferred for up to 6 months.
- Interest: prime rate
- Collateral/Credit Requirements:
The MBLF requires collateral as is deemed necessary to secure the loan. Such security may include real or personal property, income, or other items of value. The MBLF requires instruments of security as it deems necessary. Such security instruments include mortgages, promissory notes, UCC-1 Statements, etc.
All persons requesting assistance will receive fair and equal consideration regardless of their sex, age, national origin or ethnic heritage, race, religion, disability, or familial status.
No more than one active loan will be made to a business. This policy does not preclude rewriting a loan to accommodate new or imposed changes experienced by a borrower. Multiple loans may be made at the board=s discretion, when it is in the best interest of the City and the MBLF.
Prior to application to the MBLF, applicants are expected to access technical assistance to develop a business plan in order to foster the best chances for the business= success and to protect the MBLF=s interest in repayment.
Loans which have no prospect of repayment will not be made.
Every effort will be made to collect delinquent loans. All security agreements will be enforced to the fullest extent of the law.
Loans will be in default if the business moves any substantial portion of its operation (25% of assets, jobs, or inventory) out of the Designated Downtown District.
Loans will also be subject to immediate review and possible termination if the business:
- fails to complete the financed activities within the time frame specified in the loan agreements;
- violates any other condition of the loan documents;
- uses loan funds for anything other than the specified business and the approved loan activities;
- becomes delinquent on any taxes;
- is operating illegally;
- is delinquent on its loan payments (unless arrangements for deferral have been agreed to in writing by the MBLF);
- is in persistent violation of State and local building codes, ordinances, and regulations;
- fails to obtain the necessary permits for the project;
- fails to document employment goals; or
- is sold or otherwise conveyed.
Loans will not be made to members of the Loan Committee or any members of their immediate families during their tenure.
Loan Application:
Interested businesses shall submit a pre-application abstract to the Planning and Community Development Office. If the proposed enterprise is consistent with the goals of the MBLF the applicant will be invited to submit a full application.
download a printable copy of the Montpelier Business Loan Fund Pre-Application Abstract (2 pages,
94 KB, Adobe PDF )
)The applicant shall then submit an original and 5 copies of the loan application and supporting materials. Only complete loan application packages will be forwarded to the Loan Committee for review. There is a $30 loan application fee.
download a printable copy of the Montpelier Business Loan Fund Application (6 pages,
93 KB, Adobe PDF )
)Planning and Community Development Staff shall prepare a summary and recommendation for the Loan Committee members. The Loan Committee will be afforded access to the entire application file and will act to approve or deny each loan application. Recommendations for loan approval by the Loan Committee must be ratified by City Council.
The loan package will be considered at a regular meeting of the Loan Committee in the absence of the applicant. The applicant will be given an opportunity to present the committee with additional information, answer questions, and respond to concerns or criticisms at a separate meeting if so desired by the Loan Committee.
Loan Making:
The Loan Committee may impose terms and conditions consistent with the goals of the MBLF. Prior to closing, Planning and Development Staff shall execute a letter of commitment which shall detail closing requirements and other terms and conditions. All applicable municipal, state, and federal permits must be obtained prior to the loan closing. Loan funds will not be disbursed until the borrower has met all conditions of the commitment letter, delivered security instruments, and executed all documents required. Typical loan conditions may include:
- Providing monthly financial statements.
- Books open to Montpelier Business Loan Fund Committee, the Director of Planning and Community Development, and their designees.
- The submission of yearly cash flow projections.
- Periodic business inspections.
- Copies of receipts verifying the use of loan funds as approved by the Committee.
- Employment records, as required by the Loan Committee.
Low and Moderate Income Limits
Household Size |
1 |
2 |
3 |
4 |
5 |
6 |
7 |
8 |
Annual Income |
$35,050 |
$40,050 |
$45,050 |
$50,100 |
$54,100 |
$58,100 |
$62,100 |
$66,100 |
These income limits are provided by the United States Department of Housing and Urban Development and are updated periodically.
Contacts
-
City of
Montpelier
Department of Planning and Community Development
39 Main Street, City Hall
Montpelier, VT 05602-2950
Tel: (802) 223-9506
FAX: (802) 223-9524
E-mail: planning@montpelier-vt.org
Planning & Community Development Staff:
- Gwendolyn Hallsmith, Director, ext 31, ghallsmith@montpelier-vt.org
- Nina Thompson, Community Development Specialist, ext 32, njthompson@montpelier-vt.org
- Audra Brown, Planning & Zoning Assistant, ext 35, abrown@montpelier-vt.org
- Clancy DeSmet, Planning & Zoning Administrator, ext 33, cdesmet@montpelier-vt.org
- Eric Scharnberg, Web/GIS Specialist, ext 36, escharny@montpelier-vt.org
Updated May 30, 2007
Please send comments to: webmaster@montpelier-vt.org
Copyright © 1998-2008 City of Montpelier, Vermont.
Hosted by http://www.networksolutions.com