The Jobs Development Authority of Grand Forks signed off on a number of changes to its economic development programs, previously outlined at a March 22 Growth Fund meeting.
At the JDA/City Council meeting on Monday, April 5, JDA staff agreed to submit plans to the U.S. Economic Development Administration to de-federalize its existing revolving loan fund. The EDA, according to Meredith Richards, director of community development, is inviting communities to take this action with “legacy” revolving loan funds so the agency can focus on its coronavirus programs for businesses.
De-federalizing the program removes federal reporting requirements for the $1.3 million in funding, and reverts that money to local control, provided the money is used for economic development purposes. Once freed up, those funds would likely be used to help create a downtown tech hub at the Herald building. The loan fund is capitalized by $335,000, and receives monthly payments from loan holders totaling $14,600 per month, which will top out at $1.3 million
“EDA did state that we could use these funds as the local match for our requested construction grant that we have submitted to EDA, to use for fit-up of the Herald building as a tech accelerator,” Richards told JDA members.
The JDA also authorized steps to bolster the C-RUN loan program, created in September 2020, to aid businesses impacted by the coronavirus pandemic. Changes include raising the loan cap from $50,000 to $347,500, though that amount would be reserved for businesses that demonstrate “extraordinary circumstances.” The JDA agreed to put in place a soft cap of $200,000 for other businesses. The terms of the loan include a 1% interest rate for five years, though businesses using the funds to purchase equipment can have that loan extended by two more years.
City staff will work to more aggressively market the C-RUN program, as those funds must be expended by the end of June, 2022, or they could be taken back by the EDA and given to other communities. At present, about $300,000 has been loaned out of the $1.3 million program.
Information about C-Run can be found at grandforksgov.com, by calling the city’s community development department, or by speaking to staff at the North Dakota Small Business Development Center.
In other JDA news:
The JDA OK’d a $25,000 C-RUN loan for French Taste LLC, a crepe-making business located inside Ferguson Books & More, in the Grand Cities Mall. The loan will be used for payroll and the creation of a website, to facilitate online ordering.
JDA members also granted a $225,000 loan to Sundog Mining LLC to buy down interest on another loan from Gate City Bank. This is likely the last loan the JDA will be able to make from its legacy revolving loan fund before it is de-federalized. The start-up company will purchase a cargo container, and fit it up with computers to create a mobile crypto-currency operation in Grand Forks. At first, the container will be located at a Minnkota substation. The company will buy discounted electricity from the utility, as the station is not operating at full capacity, due to the lack of need. When that need arises, the container can be moved to another location, with a similar surplus of power.
At the recommendation of City Attorney Dan Gaustad, the JDA voted to officially accept the transfer of ownership of the Corporate Centers I and II, from the city to the JDA, essentially a formality, to prepare for a possible sale of the buildings later this year.