Wednesday, July 23, 2014
Cayuga County Loan Program

This program is designed to assist businesses within Cayuga County.

Guidelines:

  • Loans up to $75,000 or at the discretion of the Cayuga County Loan Committee.
  • For every $15,000 borrowed, one new full-time job to be created.
  • Interest rates are usually low (prime or below).
  • Loan proceeds can be used for working capital, soft costs, acquisition, construction, machinery and equipment.
  • Funds can be used to cover up to 40% of the total project costs.
  • Projects must be located within Cayuga County.

Financing Policies

The following financing policies are established to maximize the effectiveness of the program and provide clear guidelines for program administration:
  1. Terms of Loans
    The terms of the loans are established on an individual basis. In most cases each loan will be amortized over a period not to exceed five (5) years.
  2. Interest Rate
    Interest rate on all loans will be based upon a fair market interest rate and the credit profile of the applicant.
  3. Finance Charges
    Cayuga County incurs certain expenses when providing loans to local firms. Included in these costs are credit verification and the filing of collateral documents. Additionally, a considerable amount of staff time is required to process application and draft the legal documents. In order to reimburse these expenses there will be a finance charge of one percent (1%) of the loan amount to be charged to the business receiving the loan at the time of the closing.
  4. Late Fees
    When a monthly payment on a loan is more than fifteen (15) days overdue, a late charge in the amount of two percent (2%) of the monthly payment will be levied against the borrower.

Eligibility Requirements

  • The following eligibility requirements are applicable to projects funded through the Cayuga County Loan Program. The eligibility requirements are designed to limit County participation under the Cayuga County Loan Program to the most appropriate projects.
  • Maximum Amount: The maximum amount of County participation shall generally not exceed $75,000 under the County´s Revolving Loan Fund. Waiver of this limit can be made if the economic impact of the project is certain and significant.
  • Proposed Use of Funds: Funds may be used for construction of new buildings, purchase of land or buildings, renovation or expansion of existing buildings, or purchase of new machinery and equipment. Funds may not be used for regular maintenance of buildings or refinancing. Eligibility for funds to be used as working capital or for purchase of inventory is discretionary depending upon each individual case.
  • Necessary Leveraging: (Leveraging includes funds from private sources such as owner´s equity, project investment, and participation by financial institutions, etc.).
  • Collateral: All loans must be adequately secured in the amount of the loan.
  • Tax Status: Only businesses which are current in payment of County taxes are eligible for the Cayuga County Loan program.

Job Creation Criteria:

  • For each $15,000 of County assistance at least one new permanent full-time job must be created.
  • Special efforts will be made to ensure that permanent jobs created by the Cayuga County Loan Program are made available to low income persons.

Loan Process

The loan selection and approval process will be consistent for all borrowers. The financial and non-financial information to be requested from the applicant includes, but is not limited to:

  1. Program Application
  2. Business Plan
  3. Credit Investigation Form
  4. Personal Financial Statements (On Principals)
  5. Twelve (12) Month Cash Flow Projections
  6. Current Balance Sheet
  7. Profit/Loss Statements for Previous Three (3) Years (if existing business)
  8. Personal Resumes (On Principals)

Approval Procedures

  1. Applicant contacts the Department of Planning and Economic Development expressing interest in program. Office staff explains program to applicant and, if necessary, furnishes applicant with application package.
  2. Completed application is reviewed by staff to determine congruence with eligibility criteria and to assess economic impact potential. Additionally, staff will perform the following:
    • Financial analysis to ascertain the feasibility and credit worthiness of the proposal.
    • Credit analysis to ascertain the creditworthiness of the applicant(s) and the business.
    • Collateral analysis to determine acceptable assets to be used as collateral.
    • Cash flow analysis to determine the financial feasibility of the loan request.
  3. The application is presented to the Loan Committee. Application is either approved and terms of the loan established, or if the application is disapproved, the application may be resubmitted for consideration once negative issues are resolved.
  4. The loan package is submitted to the County´s legal counsel for review.
  5. Loan Closing
    The staff of the Cayuga County Loan Committee will contact the borrower and undertake preparations for the closing of the loan.

For more information on this program contact:

Cayuga County Planning Department
160 Genesee Street
Auburn, New York 13021
(315) 253-1276 or e-mail planning@co.cayuga.ny.us