On April 6, the Preston City Council approved an Economic Development Authority recommendation to modify the City of Preston EDA Local Revolving Loan fund. The modification assigns $30,000 to support local businesses through a local emergency revolving loan.
Revision to the EDA 270 Revolving Loan Fund includes:
•The EDA will set aside $30,000 of the 270 loans account for City of Preston emergency business loans as a response to unfolding circumstances centered around plans to control the spread of the COVID-19 virus.
•Specific uses for loan funds: Utility payments and property tax payments that cannot be deferred.
•Maximum loan approval amount for each applicant up to $3,000.
•Zero (0) percent interest, a five (5) – year amortization schedule, (repayments will be $50 per month, or less).
•Repayments are due beginning January 1, 2021, late fee for missed repayments begins to be added onto the end of the loan at the amount of $5.00 per month.
•Applicants are required to sign: A loan agreement, promissory note, and a personal guarantee if the applicant is an entity other than a sole proprietor.
•Processing of the businesses most current invoices begins after the application is accepted and loan documents are signed.
•The applicant will submit to the EDA a current utility bill or tax bill as proof of the amount the expense due. Funding for the due and payable expenses comes from the 270 revolving loan fund on a first come basis until funds are exhausted.
•Checks will be made out to the utility or tax authority to guarantee the funds are used for the intended purpose.
•There is no cost to the applicant to set up the loan.
•Amendment to the 270 loan revision sunsets December 31, 2020, or when funds are exhausted.
Once the EDA receives the business application and current invoice, EDA approved invoices will be paid out on a first come basis. The EDA board will review and approve payments at their regular monthly EDA meetings. Invoices will be paid on a until the $30,000 fund pool is potentially exhausted.
To apply for City of Preston local emergency funds visit prestonmn.org.