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March 10, 2008 <br />Mounds View Business Toolbox <br />Internal Document <br />Page 7 of 10 <br /> <br />The SBA 504 Loan program provides fixed-rate, long-term financing for land, <br />buildings and manufacturing equipment or machinery. SBA 504 Loans feature a <br />10 to 20 amortization, fixed-loan payments, below market interest rates, and a <br />low downpayment. The deal structure is 50% bank loan (1st position), 40% SBA <br />504 (2nd position), and 10% equity injection. (A new business and a special- <br />purposed building require 20% equity injection.) The program’s minimum and <br />maximum loan amounts are $50,000 and $750,000 respectively. <br /> <br /> How does the program work? <br />Businesses should contact the certified development company authorized by <br />SBA to originate and service SBA 504 loans in their geographic area. SPEDCO <br />is a non-profit certified development company located in New Brighton whose <br />mission is to help small businesses obtain financing for job creation, to fund <br />business expansion and to promote economic development in Minnesota. <br />SPEDCO can handle SBA Loan financing for businesses wishing to expand or <br />locate in Mounds View. They provide long-term, fixed rate loans through the <br />SBA 504 Loan program and also provide 7(a) loan packaging consulting services <br />to banks and their customers. For more information call 651-631-4900. <br /> <br />2) State of Minnesota Business Financing Programs <br />The Department of Employment and Economic Development encourages the <br />creation of high quality jobs through business growth, expansion and retention. <br />Business Development Services help companies expand or relocate in <br />Minnesota, find and train employees, promote international trade, and finance <br />business expansions. The most likely funding program applicable to Mounds <br />View businesses would be the Minnesota Investment Fund (MIF). It’s designed <br />for businesses acquiring “fixed assets” (such as equipment, buildings, and land) <br />and adding new employees as a result. This program provides companies <br />below-market financing. Virtually all types of businesses are eligible, except <br />retail. The maximum award is $500,000. The applicant is the city. Terms are <br />negotiated. <br /> <br />3) Ramsey County Business Loan Program <br />The Ramsey County Business Loan Program provides gap financing that can be <br />used in conjunction with other private and public funds. <br /> <br />Who can apply? <br />In general, loans are restricted to commercial, industrial, or service oriented <br />businesses located in or moving to Ramsey County. In addition, businesses <br />must be registered to do business in the State of Minnesota and demonstrate a <br />need for public financing. <br /> <br />How does the program work? <br />Loans are typically made for the purchase of capital equipment, land and building <br />acquisition, and building rehabilitation or new construction. Application fees are