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South Florida Regional Planning Council Revolving Loan Fund

The South Florida Revolving Loan Fund offers loans from $50,000 to $300,000 to existing businesses in the South Florida region. Our goal is to create and retain jobs, support business expansion and relocation, and strengthen the local economy.

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South Florida Regional Planning Council Revolving Loan Fund

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  1. South Florida Regional Planning CouncilRevolving Loan Fund “Growing South Florida’s Economy: One Business at a Time”

  2. HISTORY • U.S. Department of Commerce (EDA) • Dade County Economic Research Foundation, Inc. (Beacon Council) • Miami Capital Development Corporation (2 loan funds) • City of Homestead • Hurricane Andrew

  3. Why Are We Involved ?? • Best Economic Development Plan • South Florida Economy • Develop Small & Medium Size Businesses • Job Creation & Retention

  4. LOAN PROGRAM • We Offer Loans From $50,000 to $300,000 • All Types of Existing Businesses • Reasons for Loan • Creating Jobs • Retaining Jobs • Expanding Business • Relocating Business

  5. FINANCING STRATEGY • Our financing strategy is to make general business development loans designed to meet the credit needs for businesses not entirely served by conventional lenders. • At the same time, encourage these lenders to complete project financing by allowing our funds to fill the gap.

  6. LOAN CRITERIA • Existing business that is looking to expand or relocate its business, create jobs, and/or retain jobs. • Business must be located within S.F. Region. • Applicant must attempt to secure conventional financing first. • Must Show proof of denial.

  7. SFRPC RLF PROGRAM • All loans are secured. • We require personal guarantees by the owners of the business. • We do not do line of credits, but we do working capital loans. • Interest rate is generally a fixed rate.

  8. SFRPC RLF PROGRAM …. • We cannot loan funds for the acquisition of a business, business assets, or stock. • We cannot loan funds to churches, nonprofit organizations, civic organization, and fraternal organizations. • 10 to 20 percent equity injection into project.

  9. PROGRAM REQUIREMENTS • Complete an SFRPC loan application. • Provide a complete business plan including business and personal financial statements, tax returns and appraisals or quotes for equipment or land purchase. • Site Visits

  10. UNDERWRITER CRITERIA • Historical and projected cash flow, working capital, liquidity, and debt-to-equity ratio are considered. • Staff assesses the overall stability of the businesses by comparing the historical financials of the business. • Utilize outside underwriting agency.

  11. UNDERWRITER CRITERIA…. • Personal credit report • Business credit references • Business Debt/Income ratio • Cash Flow projection • Liquidity • Collatera

  12. UNDERWRITER’S REPORT • REQUESTED AMOUNT: • PROJECT FINANCING: • BACKGROUND: • JOB CREATION / RETENTION AND COMMUNITY IMPACT: • MANAGEMENT:.

  13. UNDERWRITER’S REPORT • COMPETITION: • VENDORS REFERENCES: • BANK REFERENCES: • FINANCIAL STATEMENT ANALYSIS: • GUARANTORS ANALYSIS:

  14. UNDERWRITER’S REPORT • REQUEST/REPAYMENT DEBT SERVICE CALCULATION: • HISTORICAL DSC: • PROJECTED DSC: • COLLATERAL DESCRIPTION:

  15. UNDERWRITER’S REPORT • STRENGTHS (+) /WEAKNESSES (-): • +Business is located in popular district. (Well positioned for continued growth and longevity.) • +Business relies on Government Contracts. • +Experienced management team in place. • + Newly built building will improve revenues. • +Projected DSC is adequate at 2.84X • +Borrower’s credit is sufficient • - SFRPC has to assume 3rd place.

  16. LOAN ADMINISTRATION BOARD Five Member Board: • Small Business Owner • Banker • Economic Development Agency • Council Member • Executive Director

  17. LOAN ADMINISTRATION BOARD…. • The LAB strives to obtain sufficient and adequate collateral. • While recognizing that shortfalls in security may exist. • Require personal guaranties by all parties with more than 20% ownership. • In addition liens are also placed on other non-project assets of the borrower.

  18. COLLECTION • Grace Periods • 30, 60, 90 Day Letters • Phone Call, Site Visits • Set a policy on when to assign a loan to legal

  19. DEFAULT RATE We have serviced 114 loans over the years Outstanding Principal (42 loans) $6,283,211 Total Loan Fund (including cash) $7,036,019 Loans in Default $ 364,166 Default Rate .06% EDA National Average 15%

  20. SFRPCADDITIONAL LOAN PROGRAMS • Broward County Cultural Arts Division Micro-Credit Loan Program • State of Florida Small Business Emergency Bridge Loan Program • EPA Brownfield Revolving Loan Program • The City of Ft. Lauderdale Energy Efficient CDBG Revolving Loan Program

  21. South Florida Regional Planning Council Revolving Loan Fund “Growing South Florida’s Economy: One Business at a Time”

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