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Home My WebLink About97-7 Resolution No. 97-7 RESOLUTION APPROVING LOAN UNDER THE SPECIAL BUSINESS LOAN PROGRAM FOR BUILDING IMPROVEMENTS IN ELGIN CENTER CITY WHEREAS, the City of Elgin and certain banks and savings and loan institutions have established a special business loan program for building improvement in Center City Elgin for revitalization purposes; and, WHEREAS, Grace Richard has submitted an application to Union National Bank for loan under the special business loan program; and, WHEREAS, the Union National Bank has approved this loan under the special business loan program; and, WHEREAS, the loan is for the improvement of a type of business located in an area of the Center City of Elgin which meets the eligibility requirements of the special business loan program; and, WHEREAS, the loan application meets the general requirements concerning type of financing, contractor bids of the special loan program; and WHEREAS, the loan applicants meet the qualifying standards as set out in the special business loan program; and WHEREAS, it is determined that funds are available for the loan, the development plans are compatible with the Center City development plans, and the application is in adherence to the objectives and regulations of the program. NOW, THEREFORE, IT IS RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN, ILLINOIS, that Robert O. Malm, Interim City Manager, is hereby authorized to approve the special business program loan as set forth in the loan approval of the Union National Bank attached hereto and made a part hereof by reference, and to make monthly interest payments in the amount of prime plus 1 (one) percent to a ceiling of fourteen ( 14 ) percent minus six (6 ) percent so long as the borrower continues to make regularly scheduled loan payments . s/ Kevin Kelly Kevin Kelly, Mayor Presented: January 8, 1997 Adopted: January 8, 1997 Omnibus Vote: Yeas 7 Nays 0 Attest: s/ Dolonna Mecum Dolonna Mecum, City Clerk Committee of the Whole Meeting December 18, 1996 Page 3 1996 Budget Amendments Councilman Walters made a motion, seconded by Councilman Schock, to accept the budget report and approve the proposed amendments the the 1996 Budget. Yeas : Councilmembers Gavin, Gilliam, McKevitt, Schock, Walters, Yearman and Mayor Kelly. Nays : None. Employment Agreement for Gang Intervention Program Supervisor Councilman Gilliam made a motion, seconded by Councilman Walters, to approve renewal of agreement with the gang intervention program supervisor. Councilman Gavin stated the reasons why he will not be voting to approve renewal of the aforesaid contract. Councilman Schock made a motion, seconded by Councilman Walters, to call the question. Yeas : Councilmembers Gilliam, McKevitt, Schock, and Walters . Nays : Councilmembers Gavin, Yearman, and Mayor Kelly. The vote was then taken on the original motion to approve renewal of the agreement. Prior to voting, Councilwoman Yearman and Mayor Kelly stated their reasons for opposing the motion to renew the aforesaid contract. Councilman Schock registered his objection to people making statements after the question was called. Yeas : Councilmembers Gilliam, McKevitt, Schock and Walters . Nays : Councilmembers Gavin, Yearman and Mayor Kelly. Authorization of Final Payment and Acceptance of West Zone Phase III Water Main Councilman Gavin made a motion, seconded by Councilman Gilliam, to approve the completed work and authorize the final payment to Gluth Bros . in the amount of $37,429 .40 . Yeas : Councilmembers Gavin, Gilliam, McKevitt, Schock, Walters, Yearman and Mayor Kelly. Nays : None. Interest Subsidy on Special Business Loan for 10 Douglas Avenue (Former Brunner Building) Councilman McKevitt made a motion, seconded by Councilman Walters, to participate in the improvements to 10 Douglas Avenue by approving the application for interest subsidy. Yeas : Councilmembers Gavin, Gilliam, McKevitt, Schock, Walters, Yearman and Mayor Kelly. Nays : None. Grant Agreement for Wing Park Activity Area Councilman Walters made a motion, seconded by Councilman Gilliam, to enter into a contract agreement with OSLAD to ` "0 OF Etc a $ Agenda Item No. f< i ii , 00..z, City of Elgn December 11, 1996 TO: Mayor and Members of the City Council FROM: Robert O. Malm, Interim City Manager SUBJECT: Interest Subsidy on Special Business Loan for 10 Douglas Avenue PURPOSE The purpose of this memorandum is to provide the Mayor and the members of the City Council with information regarding an application for an interest subsidy under the Special Business Loan Program. BACKGROUND The City participates in the Special Business Loan Program for Building Improvements co-sponsored by local banks . The purpose of the program is to provide financial assistance to owners making improvements to existing commercial properties . The City participates by subsidizing interest on the loan made by a financial institution. The City makes a direct payment of any interest costs abovepercent 6 to a maximum of 14 loan to a of the percent . The payment is made for the life maximum term of ten years . The application presented for consideration requests an interest subsidy on a $50,000 loan (the maximum allowed under the program) . The total loan being provided the borrower is $85 , 000 at a fixed interest rate of prime + 1 ( 9 . 25%) over 120 months . The borrower will be responsible for 6 percent interest. The City would subsidize the interest payments over the life of the loan ( 120 months) . COMMUNITY GROUPS/INTERESTED PERSONS CONTACTED None. FINANCIAL IMPACT The annual obligation is estimated to be $1,625.00 ($50,000 x 3 . 25% ) . The City would be responsible for subsidizing inter- est payments over 120 months . Funds are budgeted and avail- able in 1997 in Account No. 350-0000-795 .78-03, Commercial Rehabilitation Loans . Future years budgets would need to include this interest subsidy amount . LEGAL IMPACT None. ALTERNATIVES 1 . Approve the interest subsidy based on a loan amount of $50, 000 . 2 . Approve the interest subsidy based on a loan amount of $85 , 000 . 3 . Do not approve City participation in this project. RECOMMENDATION It is recommended that the City participate in the improve- ments to 10 Douglas Avenue by approving the application for interest subsidy. Respectfully submitted, O...4(tK' °CU.° D rah K. Nier Director, New Century P rship for Elgin R ert 0. Malm Interim City Manager dkn/dkm • APPLICATION FOR ELGIN CENTER CITY SPECIAL BUSINESS LOAN PROGRAM Date: Nov8 ter 19, 1996' Bldg. .Purchase: $ 82,000 Improvements: 85,000 Loan Amount Requested: $85,000 Total Project Cost: Total: $167,000 Company Name: • Address: 10 N. Douglas Avenue, Elgin, IL 60120 Phone: = Work # (847) 741-1475 Owner's Name(s): Grace Richard Type of Business: Purpose of Loan: Renovation of entire building interior, new HVAC & A/C, convert second floor to residential. Prepare first floor for commercial tenant. BREAKDOWN OF PROJECT AMOUNT CONTRACTOR DESCRIPTION OF WORK 1. $ SEE ATTACHED 2. $ 3. $ 4. $ OTHER CONTRACTOR BIDS OBTAINED DESCRIPTION OF PROPERTY: 96 yr. old commercial building with 4,064 square feet of (Size & Description) gross building area APPRAISED VALUE: "As Is" : $81,500; When completed: $163,000 OWNER IN TITLE: Grace Richard EXISTING MORTGAGE ON PROPERTY: None OTKZR INFORMATION REQUIRED INITIALLY: 1. Business Year end Financial Statements-- last two yearn. 2. Business Interim Financial Statement--current year-to-date. 3. Personal Financial Statement-- current. 4. Copy of Contractor Estimates. 5. Corporate and/or Personal 'Tax Returns may be required. 6. Appraisal of property may be required. The undersigned applicant hereby certifies that the loan funds obtained shall be used for the purposes outlined in this application. - Date: Applicant Business BY: i-tle Owner Please deliver this completed application to the bank or savings and loan official of your choice. They will process your credit application and submit a loan proposal to the City of Elgin for final approval . 1 Sheetl GRACE RICHARD 10 Douglas Ave Breakdown of Project AMOUNT CONTRACTOR DESCRIPTION OF WORK $ 4,468 Menard Home Center Kitchen Cabinets $ 2,800 Bill &Sid's Floor Sanding Floor sanding and refinishing $ 32,000 A.R. Bex&Son General construction $ 22,852 Skirmont Mechanical Plumbing and HVAC $ 19,960 Ron Jones Electric Electrical $ 5.000 Contingency for unknown problems resulting from age of building $ 87,080 Page 1 UNION NATIONAL BANK 101 EAST CHICAGO STREET•ELGIN,ILLINOIS 60120-6466■PHONE 847-888-7500•FAX 847-888-2662 November 22, 1996 Deborah K. Nier City of Elgin 150 Dexter Court Elgin, IL 60120-5555 Dear Deborah: We spoke the other day regarding an application for the Elgin Center City Loan Program to enable Grace Richard to renovate the building at 10 N. Douglas Avenue,in Elgin,Illinois. I have enclosed Ms. Richard's formal application along with cost estimates for the work that needs to be done. I have also enclosed a copy of our appraisal that was obtained in conjunction with this loan. A review of this document clearly shows the benefit that will be derived to both the building and the Elgin downtown district from these loan proceeds. Please review this information at your earliest convenience and call me with any questions. Thank you for your consideration. Since - '. Scott Reining Executive Vice President RSR/kk Founded 1904 Union National Bank and Trust Company of Elgin Member FDIC