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CDAP Economic Development

2014 CDAP Grant Administration Workshop. CDAP Economic Development. Dave Goben Department of Commerce & Economic Opportunity. National Goals / Objectives. Assist in building the financial and operational capacity of communities to carry out local economic development Locational Argument

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CDAP Economic Development

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  1. 2014 CDAP Grant Administration Workshop CDAP Economic Development Dave Goben Department of Commerce & Economic Opportunity

  2. National Goals / Objectives • Assist in building the financial and operational capacity of communities to carry out local economic development • Locational Argument • Financial Gap Argument

  3. Low and Moderate-Income Persons "Low and Moderate-Income Persons" shall mean those individuals in a family whose income is less than 80% of the median income of the area.

  4. CDAP Economic Development • $5.0 million allocation • Maximum Grant amount $750,000

  5. CDBG-Community Development Block Grant HUD-US Dept. of Housing & Urban Development DCEO-Dept. of Commerce & Economic Opportunity

  6. Purpose • Economic Development Financial projects • Job creation with 51% LMI • Job retention with 51% LMI • Loan Agreement • Public Infrastructure in Support of Business • Participation Agreement • Job creation with 51% LMI • Job retention with 51% LMI

  7. Purpose The primary objective of program is to enable grantees to carry out local economic development activities in a way that will expand economic opportunity, principally for low and moderate-income persons. Each project shall result in private sector job creation or retention. At least 51% of such jobs shall be filled or retained by persons of low and moderate-income.

  8. Eligible Borrowers • Private for-profit • Not-for-profit entities Sub recipients must directly create or retain jobs; indirect jobs (employed by other than the borrower) are not sufficient to meet program guidelines.

  9. Eligible Grant Recipients Only units of general local government (i.e. cities, villages, townships and counties) as defined by the Illinois State Constitution may apply for funding. Municipalities must be 50,000 or less in population and must not be located in an urban county that receives “entitlement” funds. • private for-profit or not-for-profit entities.

  10. Federal Regulations/Title 1 • Job Creation/Retention with 51% LMI Benefit • Environmental Review • Required prior to loan closing • Davis-Bacon • Required for construction work using Program funds • Uniform Act • Required when real property is acquired or persons displaced

  11. Policy Guidelines • Finance no more than 50% of project • Not to exceed $15,000 for every FTE created/retained • No speculative financing • 51% LMI benefit • Economic Development grant request may be reduced by balance of RF • Department Retail Policy

  12. Eligible Use of Funds • Site development/infrastructure extension • Construct new facility/addition • Renovation of existing facility • Leasehold improvements • Purchase of machinery or equipment • Working Capital

  13. Ineligible Use of Funds • General government expenses • Forgivable financial assistance projects • Costs of operating and maintaining public facilities and services • Servicing or refinancing of delinquent or defaulted existing debt.

  14. Ineligible Use of Funds • Relocation of business from one area of the state to another • Exceeding HUD’s threshold of pirating jobs • Violation of HUD’s underwriting provisions

  15. Security COLLATERAL COLLATERAL COLLATERAL

  16. Security • All financial assistance projects to businesses shall be secured • Financial assistance agreement, mortgage, security agreement, promissory note, UCC, financing statement or other assignment of rights of the assets of assisted firms. • DCEO will underwrite each project.

  17. Employee Income Certification Forms • Use current Section 8 HUD income guidelines • Jobs and investment created by 24th month

  18. -WARNING- • Failure to comply with State or Federal Regulations could result in: • Pending, future grant requests will not be considered; • Payment requests for active grants suspended; • recovery procedures by DCEO.

  19. Revolving Fund Program DCEO Website http:wwwga.illinois.gov/dceo/pages/ Default.aspx

  20. Contact Information Dave Goben, Economic Develoment Manager Department of Commerce & Economic Opportunity 500 E. Monroe St, R-2 Springfield, IL 62701 (217) 785-6117 David.goben@illinois.gov

  21. Questions??? • Comments!!! • Concerns~~~ Thank you and good luck!

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