HomeMy WebLinkAboutMinutes - 10/3/2011 - Revolving Loan Fund Committee REVOLVING LOAN FUND COMMITTEE MEETING
L' Monday, October 3,2011
Aldermen's Conference Room, 6:45 p.m.
In Attendance: Committee Members: Chairman Mayor Low, Alderman Schaefer, and
Alderman Wi mmer. Absent: Alderman Blake.
Also in Attendance: Alderman Santi, City Administrator Black and City Clerk Jones.
Applicant: Michael Mrachek Epic Cycle and Fitness
3932 Main Street, McHenry, IL
Chairman Mayor Low called the meeting to order at 6:45 p.m.
Discussion Re�arding Revolvin�Loan Aaulication
Eaic Cvcle and Fitness
City Administrator Black stated the purpose of the Revolving Loan Program is to provide
low interest loans to qualified existing and/or prospective businesses within the City of
McHenry. The 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.
� City Administrator Black 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 McHenry Revolving
Loan Fund Committee. The Committee reviews the loan application, meets with the applicant,
visits the site �f necessary, negotiates terms, length and security of the loan, and evaluates each
request with regard to compliance with the program's goals and objectives.
City Administrator Black stated that Michael Mrachek, on behalf of Epic Cycle and
Fitness, has submitted an application to obtain a loan in the amount of$25,000 for the purchase
of inventory, tenant improvements and other start-up costs.
City Administrator Black opined that following discussions with the applicant and a
review of the business plan, Staff feels confident that this applicant fits the parameters of the
program and requests the Committees recommendation to proceed with the review of the
applicant's creditworthiness and determine the terms of the loan.
Mr. Mrachek addressed the Committee. He provided the Committee with a brief
summary of the business plan of Epic Cycle and Fitness, and indicated his intention to open a
specialty bicycle retail establishment at 3932 Main Street. The target market will be those
persons who enjoy bicycling for sport, exercise and recreation.
Responding to an inquiry from Alderman Wimmer, Mr. Mrachek stated that Epic Cycle
� is not an interim business but a new career path. He informed the Committee that he looks
forward to becoming a part of the community.
Revolving Lc�an Fund Committee Meeting
October 3, 2011
Page 2
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Aldennan Schaefer, noting the 2-year lease Epic Cycle and Fitness has on the building,
inquired if th�; bank would be willing to match the loan to the lease period. City Administrator
Black advisec he would look into the matter.
Respo nding to an inquiry from the Committee, Mr. Mrachek elaborated on the
remodeling e:cpenses. He noted that he would be inquiring at the high schools to determine
whether the a�t students would have an interest in submitting decorative murals for the interior.
Mr. Mrachek informed the Committee that it is his intention to be open year round and
that he hopes to open doors to the establishment in February 2012. He noted that the bank loan
has been decreased from $37,850 to $25,000 and his capital investment has increased from
$5,000 to $12,000.
Responding to an inquiry from Alderman Schaefer, City Administrator Black stated that
the approximate amount in the fund is $37,000.
Chairman Mayor Low opined that the business plan appears to be a good one, stating she
supports investment in local business.
It was the consensus of the Committee to direct Staff to proceed with reviewing the
creditworthiness of the applicant and to work with representatives of First National Bank of
�— McHenry to determine the terms of the loan.
Adiournment
Motion by Low, seconded by Schaefer, to adjourn the meeting at 7:14 p.m.
Aye: Mayor Low, Schaefer
Nay: Wimmer.
Absent: Blake.
Motion carried.
Respectfully submitted,
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May Susan F; Low, Chairman
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