The Revolving Loan Fund’s purpose is to assist in the retention and creation of jobs that significantly benefit rural areas, including community projects or infrastructure improvements that enhance the ability of rural communities to attract business and industry.
Eligible projects can include any business venture involved in community or economic development project that promotes job creation and/or provides needed community services that benefit rural areas. The types of projects may include industrial and commercial development, small business expansion or start-up, business incubators, community infrastructure and facilities, medical facilities, training and educational facilities, and tourism projects.
Application Procedures & Loan Administration
- Applications will be accepted at the Carroll White REMC office during business hours from 7:30 a.m. – 4:30 p.m.
- A staff person of Carroll White REMC will review applications for completeness and present complete applications to the Loan Review Committee (LRC).
- The LRC will analyze each project and make a written recommendation to the Carroll White REMC Board of Directors.
- The Carroll White REMC Board of Directors will normally review RLF applications at their regularly scheduled monthly board meeting; however, if needed and at the board’s option, they may call a special meeting to review a loan application.
- The Carroll White REMC Board of Directors has the final authority to approve or deny all RLF loan requests, and to determine appropriate terms and conditions.
- For approved loans, a loan agreement addressing all the terms and conditions, including monitoring procedures, repayments, delinquencies, defaults and remedies for that project will be prepared by the LRC. The LRC will prepare all notes, mortgages, security agreements, UCC filing and other legal documents as approved by the State, necessary to close the loan.
- The approved loan will be monitored by the LRC. Loan monitoring will require regular reporting of 1) annual income statements and balance sheets; 2) periodic management information reports; and 3) telephone contact and site visits.
- At the first signs of any potential loan payment default, the borrower will be referred to the Local Economic Redevelopment Office (LEDO) for services.
Parameters that RLF Loans Must Meet
- To assist in the retention and creation of jobs that significantly benefit rural areas, including community projects or infrastructure improvements that enhance the ability of rural communities to attract business and industry.
- Eligible projects can include any business venture that promotes job creation and/or pro- vides needed community services that benefit rural areas. Types of projects include industrial and commercial development, small business expansion or startup, business incubators, community infrastructure and facilities, medical facilities, training and educational facilities and tourism projects.
- Eligible entities include corporations, partnerships, sole proprietorships, limited liability companies, cooperatives, and governmental entities, non-profit and tribal entities.
- Uses may be for land, fixed assets, machinery and equipment, or working capital needs.
- Projects must be located in the counties of Cass, Jasper, Pulaski, Benton, Tippecanoe, Carroll, and White served by the former White County REMC.
- The minimum loan will be $5,000 and the maximum will be restricted to funds available in the RLF at the time of application.
- Projects must include a minimum of twenty percent (20%) funding from other sources.
- Interest rates will not exceed the prevailing prime rate as published in the Wall Street Journal, and will be determined based on the evaluation of ability to repay and the necessity of below market financing to make the project happen.
- In addition to accrued interest and loan servicing fee, borrowers may be charged loan closing costs, attorney’s fees, filing fees, etc., as necessary to complete loan documentation.
- Repayment will not exceed ten (10) years. The following maturities will be used as a general guideline:
- Buildings & Real Estate: 10 years
- Equipment: 5 to 7 years or depreciable life
- Working Capital: 1 to 3 years
- The RLC will provide a recommendation on term options and repayment schedule (annual, quarterly, monthly) on a project-by-project basis.
- Loans will be collateralized, as determined necessary by the Carroll White REMC Board of Directors, to secure its participation in the project, and can include, but not be limited to, mortgages, liens, letters of credit, and/or personal and corporate guarantees.
- All approved loans will be required to comply with any applicable federal law, rule or regulation relating to the Rural Economic Development Loan and Grant Program.