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EDC Minutes February 15,2008 Not Approved Page 4 • C. Discuss Business Improvement Partnership Loan Program Interest Rate Ms. Steinmetz mentioned that this item is a continuation of previous EDA discussions regarding the draft Mounds View Business Toolbox document. The EDA asked for the EDC's input regarding the Loan Program's current interest rate of 2%. Commissioner Johnson asked about the typical rate of a business loan. Chair Helgemoe responded that it depends on what the borrower is trying to finance, but if the loan is a five- year equipment loan, the rate will probably be between 6.5 to 7%, however interest rates also depend on the borrower's risk rating. He also completed some research by talking to a collegue who used to work for the Cities of Oakdale and Roseville and reported that most cities charge between 2 and 6% for loans between $25,000 and $50,000. Commissioner Johnson asked why we would raise the interest rate if the loan program isn't being used. Ms. Steinmetz answered that the most recent loan request from The Station was retracted by the applicant, which prompted this discussion. She added that she is unsure if the policy issue of offering financial incentives to businesses is the EDA's overarching concern. Commissioner Wagner asked if this program is being marketed. Ms. Steinmetz explained that none of the City's financial programs are being marketed due to the EDA's wishes. The EDC further discussed the 2% rate and the consensus was that it should cover the costs to administer the loan and that the rate should be reviewed annually. • Commissioner Belting left the meeting. D. Finalize 2008 EDC Priorities Ms. Steinmetz displayed the reformatted and reordered 2008 EDC Priorities, which were based on the EDC's January 18, 2008 discussion and the 2007 priorities. The EDC's consensus was that the priorities as listed on the screen are what they discussed on January 18th. Staff recommended that the EDC formally adopt the 2008 Priorities and that she will report them to the EDA. Motion/Second: Commissioner Johnson moved and Commissioner Meehlhause seconded the approval of the 2008 EDC Priorities. Motion Carried: 5 Ayes 0 Nays E. Review Economic Development Component of Comprehensive Plan Since the EDC's input regarding the Economic Development portion of the Comprehensive Plan has not changed for two months, Ms. Steinmetz suggested that Commissioner Meehlhause, who serves on the Comprehensive Plan Task Force, and herself provide the EDC's input thus far to the Task Force on March 12th. The EDC agreed that Commissioner Meehlhause would do a great job representing the EDC at the March 12th meeting.