Local News
No decision made on village’s revolving loan fund
TEUTOPOLIS — Somebody who has been around the proverbial block a few times advised the Teutopolis Village Board Wednesday to keep its revolving loan fund.
Village officials have contemplated dissolving the fund for fear that the financially-strapped State of Illinois would take the $286,500 balance. But Fred Walker, who has been with the South Central Illinois Regional Planning and Development commission for 37 years, told the board at the Wednesday meeting that doing so would be a mistake.
“Why panic?” Walker asked. “Don’t you think this revolving loan fund is a pretty precious commodity?
“I’d hate to see you give up this precious commodity.”
Walker said it was doubtful the Illinois Department of Commerce and Economic Development would force the village to turn over its fund balance to the state. In fact, he said, nobody at the DCEO is in charge of overseeing the program — which is designed to provide a perpetual source of funding for economic development of infrastructure projects.
“Is the village under any pressure from DCEO to expend revolving loan fund resources?” Walker asked.
He then answered his own question.
“No.”
Governmental entities create revolving loan funds through grants from DCEO that are then loaned to businesses for job creation or retention.
However, Teutopolis village officials complained Wednesday that it’s hard to loan out the fund’s assets because of the village’s relatively low number of low- to moderate-income residents.
Village President Jerry Weber said the village had 23 percent low- to moderate-income residents in the 2000 census. But for many projects, more than half of those who benefit must meet low- to moderate-income guidelines before the project begins.
“It’s been tough for our business to use this program because of the (income) rules,” Weber said.
Walker said one advantage to keeping the revolving loan fund is the shorter turnaround time for loan approval.
“If you relinquish the revolving loan fund, it could take you between four to six months to get an answer from the state on a project,” he said. “But if you retain the fund and put together an application for a specific project, it can be approved by the village board in 30 to 45 days.”
The board made no decision on the future of the loan fund, but Trustee Greg Oseland said he was reassured by Walker’s comments.
“It helps us to hear from you that we don’t have to use it or lose it,” Oseland said.
Bill Grimes can be reached at 217-347-7151 ext. 132 or bill.grimes@effinghamdailynews.com.
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