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New Business   Item #:
City Council Regular Meeting
Transfer from the Unreserved Fund Balance of the Wastewater Fund for an Economic Development Project
Telly D. Tucker
First Reading: 09/04/2018
Final Adoption: 09/18/2018
The Office of Economic Development is requesting a one-time investor dividend transfer in the amount of $3,000,000 from the Unreserved Fund Balance of the Wastewater Fund in order to establish a unique financing tool called the Special Projects Loan Fund. The intent of the Special Projects Loan Fund is to provide short term (3-5 year) financing for significant and impactful historic redevelopment projects within the Tobacco Warehouse District or Central Business District. This program will target projects that are over 30,000 square feet in size, unique in concept and/or amenities, and further contribute to accomplishing the goals of the River District Revitalization Plan.
Over the past seven years, the City of Danville has seen significant growth and investment within the River District. Even with this growth, developers have expressed a need for bridge financing tools to accompany traditional financing methods to successfully redevelop certain catalyst or high impact projects. In order to assist developers in implementing these projects and continue the momentum within this district, the Office of Economic Development recommends establishment a Special Projects Loan Fund in which development teams can apply for a short term (3-5 year) financing through the Industrial Development Authority (IDA).
Prospective applicants will need to be creditworthy, have a proven track record of successfully redeveloping multiple projects of this scale, demonstrate evidence of market demand for the concept, and exhibit the financial sources of capital and reserves necessary to successfully complete a project of this magnitude. Projects must also be well-suited for traditional bank refinancing after operating successfully over a 3-5 year period. Underwriting assistance will be provided by Virginia Community Capital or a comparable federally insured banking institution.
City Staff recommends approval of the FY 2019 Budget Appropriation Ordinance for the transfer of $3,000,000 from the Unreserved Fund Balance of the Wastewater Fund for an Economic Development Project to Establish a Special Projects Loan Fund and appropriating the same.
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