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

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Presentation on theme: "Dave Goben Department of Commerce & Economic Opportunity 2014 CDAP Grant Administration Workshop CDAP Economic Development 1."— Presentation transcript:

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

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 2

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. 3

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

5 FEDERAL CDBG HUD $$’s STATE (DCEO) CDBG $$’s ECONOMIC DEVELOPMENT GRANT CDBG $$’s to Unit of Local Government (ULG) CDBG LOAN TO BUSINESS CDBG LOAN REPAYMENTS (PROGRAM INCOME) TO ULG REVOLVING FUND LOANS MADE FROM PROGRAM INCOME BY ULG REVOLVING FUND CDBG-Community Development Block Grant HUD-US Dept. of Housing & Urban Development DCEO-Dept. of Commerce & Economic Opportunity 5

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 6

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. 7

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. 8

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. 9

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 10

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 11

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 12

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. 13

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 14

15 Security COLLATERAL 15

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. 16

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

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. 18

19 Revolving Fund Program DCEO Website Default.aspx 19

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

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


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