Delaware wonders if it wants to join a county program that offers small business loans – News – ThisWeek Community News
Whether the city of Delaware should participate in a county loan program designed to help reopen small businesses to stay afloat amid the COVID-19 coronavirus pandemic was the focus of debate on the 13th. May by city council members sitting on the city finance committee.
Delaware County Commissioners created the program with a resolution on May 14.
County Economic Development Director Bob Lamb explained the program at the committee meeting, which was held remotely and streamed live on the town’s Facebook page.
The loan money can be used to cover up to four months of rent, mortgage and / or utility payments, he said. The terms of the loan would be extended for five years at an interest rate not exceeding 4% and an initial rate of 3%. The first installments can also be deferred for up to six months.
The loans would be funded by money donated by the county and its municipalities, he said.
On May 15, Lamb said the townships of Orange and Liberty had agreed the day before to contribute $ 250,000 each. Lamb told the finance committee the county is hoping for a similar contribution from the city.
He said county leaders are also hoping to receive matching funds from Jobs Ohio, a private, non-profit economic development organization.
The county has contacted several banks, he said, and the Buckeye State Bank will provide the loans and review each loan application.
If Jobs Ohio provides matching funds, Lamb said, the county is considering loans ranging from $ 10,000 to $ 25,000.
At the May 14 Commissioners’ meeting, it was estimated that 200 to 220 individual loans would be created.
Lamb told the finance committee the main goal was to provide relief to small local businesses that suffered losses during the state’s pandemic shutdown.
“Our # 1 priority here is to put money in the hands of our small business community.… Our businesses are in a very difficult situation right now,” he said.
Council member Kent Shafer said he heard from companies that may find it difficult to reopen.
“From what I understand from the polls and other information I get, we have businesses in our downtown area and probably elsewhere that at this point are not sure they can reopen and survive,” a- he declared. .
The county plans to act quickly, Lamb said.
“Our goal is to get the money to the business community as quickly as possible,” he said. “The moment we get a firm commitment from Jobs Ohio, we are opening applications.”
Board member Lisa Keller objected to several points of the loan program.
She said the city had known about the program for less than 24 hours at the time, and “I haven’t seen anything in writing. Why are we talking about this like we’re about to spend. . other people’s money before one of us has had a chance to review it or read a single thing about it?
“The city of Delaware could end up with zero dollars.… It’s not our only option,” she said.
At a plenary council meeting on May 11, the possibility of reviving the city’s recently inactive revolving loan fund to help businesses was discussed.
City Councilor George Hellinger agreed with Keller on May 13, saying decisions made quickly aren’t always ideal.
“There is a lot to be said to slow things down,” he said.
Hellinger said he would prefer the county program to have a sunset provision so that it does not become “a nebulous entity with a life of its own.”
Delaware Director of Economic Development Sean Hughes said the city would be challenged to implement a similar program in a timely manner.
He said it took six to nine months to secure loans under the city’s revolving loan program, which is backed by the federal government and requires federal loan reviews.
The city could consider setting up a loan program with the Ohio Economic Development Institute, he said, which is generally not competitive with interest rates. Shafer said unlike the county, the city does not have a program in place and cannot establish one within a reasonable time frame. If the city could establish a program, it would likely miss the favorable terms of the county program, he said.
If the city participates in the county program, he said, it would only take 10 loans of $ 25,000 each to ensure the city’s financial contribution stays in Delaware.
City attorney Darren Shulman cautioned against council approval of participation in the county’s program by a single emergency vote conducted at a special meeting.
The city could be accused of not being transparent, he said, as a first reading at a special meeting, with a vote held at a regular meeting, “does not ruin anyone’s ability to to participate”.
Lamb said the committee forming the county program works daily and will present all related documents to the city as they are completed.
The county would welcome the city’s participation in the city’s calendar, he said, but will not delay the start of the program.
A county press release said a committee overseeing the administration of the loan fund will include county administrator Michael Frommer, Lamb, local businessman Donald E. Rankey Jr. and up to four representatives. other entities that contribute at least $ 250,000 to the fund.