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cli~ OF SAN BERNARDI~~ - REQUE~~ FOR COUNCI[ ACT'~N
From:
KENNETH J. HENDERSON, DIRECTOR
Subject: CAPITALIZATION OF SMALL BUSINESS LOAN
PROGRAM
Dept:
COMMUNITY DEVELOPMENT
Date:
DECEMBER 23, 1986
Synopsis of Previous Council action:
On November 3, 1986, the Mayor and Common Council approved in concept the transfer of the
San Bernardino Economic Development Council Small Business Loan Program to the City.
On Decmeber 8, 1986, the Mayor and Common Council approved the transfer of the SBEDC
Small Business Loan Program to the City and established the City of San Bernardino Small
Business Revolving Loan Program with appropriate guidelines and standardized loan
agreement.
Recommended motion:
Move to approve allocation on a fifty-fifty (50-50) basis approximately $726,413,
in one percent (1%) IDB funds to the City of San Bernardino Community Development
Department and the San Bernardino Economic Development Council, and, further,
that the City Attorney's Office be directed to prepare a resolution allocating
future fund proceeds to City Community Development Department.
~A GSi~
Contact person:
Ken Henderson
Phone:
5065
Supporting data attached:
Staff Report
Ward:
1-7
FUNDING REQUIREMENTS:
Amount:
N/A
Sou rce:
IDB One Percent Fee
Finance:
Council Notes:
75-0262
Agenda I tem No.
j,
CITt' OF SAN BERNARDIN" - REQUE~" FOR COUNCIL ACT'''N
STAFF REPORT
In 1981, 1982 and 1983, the Mayor and Common Council adopted
resolutions and amendments to same establishing and
capitalizing the San Bernardino Economic Development Council
(SBEDC) small business revolving loan fund. As a result of
those actions some $2.3 million dollars was transferred to
SBEDC.
On December 8, 1986, the Mayor and Common Council took
actions approving the transfer of the SBEDC small business
revolving loan fund and establishing the Community Develop-
ment Department Economic Development Program (small business
loan program). Although the City assumed all SBEDC loans,
agreements and assets, according to an audited SBEDC finan-
cial statement for the period ended September 30, 1986, only
$2,224.00 would be transferred to the City. Since the
receipt of the financial statement noted above, staff has
been exploring alternative means to capitalize the newly-
established City small business loan program.
Traditionally, this program has been funded with proceeds
from the one-percent (1%) IDB fee. However, recent dis-
cussions have centered around the SBEDC receiving a portion
of available and anticipated revenues in order to implement a
comprehensive marketing program on behalf of the City. While
recognizing the need for effective marketing of the City, it
is important to keep in mind the actions taken to date by the
Mayor and Common Council and staff in designing an effective
small business loan program with specific guidelines, goals,
objectives and underwriting criteria. All that is needed is
a funding source and the most logical (and previously
approved source) is the one percent (1%) lOB fee.
A fifty-fifty (50-50) split of available and anticipated
revenues is fair and equitable and will allow the economic
development program to commence with a good financial founda-
tion. Staff recommends adoption of the form motion.
rector
epartment
Kenneth J. enderson,
Community Development
file: staffreportedc
KJH/lb
75-0264