HomeMy WebLinkAboutMinutes - 12/2/2013 - Finance and Personnel Committee FINANCE AND PERSONNEL COMMITTEE MEETING
� Monday,December 2, 2013
Aldermen's Conference Room, 6:30 p.m.
In Attendance: Committee Members: Chairman Alderman Wimmer, Alderman Condon
and Alderman Schaefer. Absent: None.
Also in Attendance: City Administrator Morefield, Deputy City Administrator Martin and City
Clerk Jones.
Also in Attendance: Perry Moy Plum Garden Restaurant
3917 W. Main Street, McHenry, IL
Chairman Ald�rman Wimmer called the meeting to order at 6:30 p.m.
Discussion Regardin�Revolving Loan Aanlication
Plum Garden Restaurant
Deputy City A,dministrator Martin reiterated that the purpose of the Revolving Loan Program is
to provide lo�• interest loans to qualified existing and/or prospective businesses within the City
of McHenry. 7'he loan proceeds can be used to assist in the start-up of a new business, expansion
of an existing business, updating of an existing facility to make the business more competitive or
to provide an incentive for businesses to relocate to the City. He stated that the primary goal of
the program is job creation and the expansion of the sales tax and property tax base. He informed
the Committee that the program was established in the late 1980's with funding from a State of
`-' Illinois grant. He stated that the program requires loan applicants to complete a formal
application, which is reviewed by the Revolving Loan Fund Committee consisting of the Mayor
and members of the Finance and Personnel Committee. The Committee reviews the loan
application, meets with the applicant, visits the site if necessary, negotiates terms, length and
security of the loan and evaluates each request with regard to compliance with the program's
goals and objectives. Because of the limited funds available, loans are restricted to $50,000.
Loan applicants are required to pay all attorney and processing fees and personally guarantee
repayment of the loan.
Deputy City Administrator Martin advised the Committee that Perry Moy, on behalf of Plum
Garden Restaurant, has submitted an application to obtain a loan in the amount of$35,000 for
the renovation and expansion of the restaurant, $30,000 for the purchase of new furniture and
$5,000 for working capital. It was noted that the expansion will add approximately 2,600 square
feet of addition footage to the restaurant, accommodating approximately 100 more customers
and creating twelve more jobs. Total construction costs have been estimated at $78,000. A
permit has already been issued for the renovations and construction is under way.
Mr. Bill Busse of First National Bank of McHenry, who is conducting underwriting services for
the proposal loan application, visited the restaurant and inspected the proposed improvements.
Mr. Busse indicated to Staff that the restaurant business currently has no debt and a positive cash
flow. Mr. Busse is comfortable recommending a loan in the amount of$33, 605 for the purchase
of equipment, furniture and fixtures,but forgoing the request for$5,000 for working capital.
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Revolving Loan Fund Committee Meeting
December 2, 2013
Page 2
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Mr. Busse is recommending approval of the loan for a five year term with an interest rate
equaling the prime rate, currently 3.25%, subject to the following terms and conditions:
1. He will require securing the loan with a first lien purchase money security
interest in the business assets purchased (i.e., equipment);
2. Acquiring an unlimited personal guarantee from Mr. Perry Moy; and
3. Requiring the submittal of personal and business financial statements
annually.
Staff feels co�ifident the applicant fits the parameters of the program and concurs with Mr.
Busse's recommendations.
Mr. Moy addr�ssed the Committee. He stated he is proud to be a businessman in the City of
McHenry and ��wner of the oldest restaurant on Historic Main Street. He thanked the Committee
for their time and consideration.
Responding to an inquiry from the Committee, Mr. Moy indicated he hopes the renovations to be
completed in t�vo to three weeks.
Alderman Condon opined that Plum Garden is a long-established business in the City and she
sees no reason to not support this request.
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Motion by Schaefer, seconded by Condon recommending the application for approval
and directing Staff to proceed, work with representatives of First National Bank of McHenry to
determine the terms of a loan in the amount of $33,605, subject to the following terms and
conditions:
1. Securing the loan with a first lien purchase money security interest in the
business assets purchased (i.e., equipment);
2. Acquiring an unlimited personal guarantee from Mr. Perry Moy; and
3. Requiring the submittal of personal and business financial statements
annually; and
to present to full Council for consideration.
Adi ournment
Motion by Condon, seconded by Schaefer,to adjourn the meeting at 6:37 pm.
Aye: Condon, Schaefer, Wimmer
Nay: None.
Absent: None.
Motion carried.
Respectfully submitted,
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� Richard W. Wimmer, hairman