1. CDAP Economic Development
Grant Administration Workshop
CDAP Economic Development
Introduction
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
National Goals / Objectives

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.
Low and Moderate-Income Persons

4. CDAP Economic Development
$5.0 million allocation
Maximum Grant amount $750,000
RF’S MUST REPORT TWICE A YEAR

5. CDBG-Community Development Block Grant
How the REVOLVING FUND was established.
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
Purpose

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.
Primary Objective

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.
Eligible Borrowers

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.
Ineligible Borrowers

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
Federal Regulations/Title 1

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
E/D – PAY DOWN RF…. CANNOT BE COUNTED AS LEVERAGE …. YOU CAN USE IN PROJECT BUT, AGAIN NOT AS LEVERAGE.

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
Eligible Use of Funds

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.
Ineligible Use of Funds

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
Ineligible Use of Funds

15. COLLATERAL Security COLLATERAL COLLATERAL
This wouldn’t apply to investments, royalty agreements, etc., as equity risks offer greater returns-without security-then loans.

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.
This wouldn’t apply to investments, royalty agreements, etc., as equity risks offer greater returns-without security-then loans.

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

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.
-WARNING-

19. Revolving Fund Program
DCEO Website
Default.aspx
DCEO Website

20. Contact Information
Dave Goben, Economic Develoment Manager
Department of Commerce & Economic Opportunity
500 E. Monroe St, R-2
Springfield, IL
(217)
Contact Information

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