In a sudden move, Cirrus Aircraft has repaid loans totaling nearly $800,000 to the Jobs Development Authority of Grand Forks.
The three loans were taken out in 2002, ‘06, and ‘13, and were for renovations and equipment upgrades at the city-owned facility, which Cirrus is leasing, according to a JDA staff report provided to the Herald.
“One of our key manufacturing partners in the community is doing very well,” said Meredith Richards, community development director for the city of Grand Forks.
Two equipment loans totaling $151,083.47 must, by rule, be paid back to the U.S. Economic Development Administration’s Revolving Loan Fund, from which they originated. The nearly $650,000 that remains most likely will be used by the JDA to repay Bremer Bank, from which it borrowed money to carry out renovations and expansions to Cirrus’ facility over the years. The balance of loans from Bremer totals about $515,000, which should net the JDA around $130,000, to be placed into its operating fund.
Authorization must be given from the Growth Fund and JDA to repay the Bremer loans. The Growth Fund Committee meets on Monday, Dec. 9, to make a recommendation on how to proceed. Final action is expected by the JDA on Dec. 16.
Loans from Bremer mature in March of 2021. Early repayment of the loans will save the JDA $19,600 in interest, according to the staff report. The staff report further states that Bremer Bank has waived any prepayment fees or penalties.
Cirrus' facility at 1400 South 48th Street is under lease to the city until 2021, when it then has the option of buying the facility or renegotiating a new lease.
In a February 2019 press release, Cirrus stated it had delivered 380 of its SR-Series aircraft in 2018, a 7% increase from 2017. The press release also noted it was accelerating production of its Vision Jet, a single-engine personal jet introduced in 2016.
A May 2019 release announced a new facility in McKinney, Texas.
“Factory Service operations will be offered to customers beginning in August 2019, and in late 2020 the facility will expand to include a new, dedicated Cirrus Aircraft facility on site that offers flight training, maintenance and aircraft management,” the release stated.
The staff report seeking authorization to repay Bremer Bank stated Cirrus did not provide a specific reason for the sudden repayment, though it is an indication of the strength of its operation in Grand Forks.
The Herald reached out to Cirrus seeking comment for this report, but calls were not returned prior to publication.
“Cirrus is doing very well,” said Richards. “(I) wouldn’t be surprised if an expansion of the Grand Forks facility was something that we saw in the near future.”