Economic Development Loan Program
The City of West Allis utilizes CDBG funds to support an Economic Development Loan Program. The Revolving Loan Fund (RLF) provides gap financing in the form of loans to businesses when private financial institutions won't cover the entire amount needed for the project.
For this loan program the City uses federal funds to create job opportunities for low-to-moderate income workers. Borrower must guarantee that he/she will create at least one new job for every $10,000 the City lends. At least 51% of these new jobs must be filled by a worker from a low-to-moderate income household. Any construction/rehabilitation work associated with these loan funds must comply with Federal Fair Labor Standards provisions of the Davis-Bacon Act, i.e. contractor must pay prevailing wage. Federal rules require the City to apply a "necessary and appropriate" test to all loan requests. This means that the applicant must provide evidence that he/she is unable to obtain all the financing needed for the project on affordable terms.
In cases where the project will result in an extraordinary economic benefit to the community, the Common Council will consider waiving these guidelines on eligible costs, required lender participation and maximum loan amount.
- Average processing time: 60 days
- Eligible businesses: industrial and commercial
- Eligible costs: acquisition of property and equipment, new construction or rehabilitation of existing facilities. No working capital loans.
- Fees: 1% of loan amount, minimum of $500
- Interest rate: market rate
- Maximum loan amount: $150,000
- Minimum loan amount: $10,000
- Repayment terms: Matched to company's debt service capacity, maximum of 20 years.
- Structure: the City's program is intended to bridge the gap between the amount a conventional lender is willing to lend and the amount that is needed to finance the project. Lender participation must be at least 67%.
For additional details and application information, please contact Patrick Schloss, Community Development Manager at 414-302-8468.