The Regional Development Corporation (RDC) supports increased private investment that expands or retains employment in Erie County. Goals include enhanced competitiveness of local businesses, local ownership of firms employing local residents, formation of new companies especially in the technology sector and support for minority and woman-owned businesses and businesses in designated Enterprise Communities or economic development zones (Click here to access RDC Target Sectors list). Eligible uses generally include permanent working capital, equipment purchases, pollution control improvements, and loans to effect changes in local ownership when the employment base of the company would otherwise be in jeopardy. (Click here to access Buffalo and Erie County Regional Development Corporation Annual Policy and the document Ineligible Uses for RDC Loan Funds). Unless specifically noted the following is typical for RDC loans:

• The maximum loan available is $750,000. Loans of $350,000 or larger will have a floating rate tied to the Prime.
• The RDC loan may not exceed 50% of the project.
• Loan proceeds cannot exceed $50,000 per job created or retained over a three year period.
• Loans for retail are not eligible.
• Maximum loan term is commonly seven years with a maximum of fifteen (15) years.
• RDC loans may not substitute for private capital or other financing when available.
• Refinance of existing debt is not an eligible use of RDC funds.
• RDC takes a junior collateral lien.

Eligibility

     An eligible borrower may be a proprietorship, partnership or corporation that is recognized as operating in a targeted industry within the RDC Loan Administration Plan. Priority will be given to targeted industries and to companies located in designated distressed areas of the county and economic development zones. Specific applicant eligibility is determined in accordance with the federally approved RDC Loan Administration Plan.

Restrictions

     No expenditures or commitments for expenditures should be made prior to issuance of the RDC commitment letter.

Application Procedures

     Application procedures vary depending on the amount of the loan request. RDC staff will meet with the applicant to determine if the project appears eligible. Applications should be prepared using the Basic Loan Application Requirements checklist. If available, copies of the lender's loan case and commitment letter enhance the application.

Loan Closing/Fees

The loan closing date is scheduled by mutual consent of the financing participants, pending the preparation of final loan closing documentation. A fee of one-half of one percent (0.5%) of the principal amount of the loan is required and payable by the company at the time of acceptance of the letter of commitment. Standard legal services associated with the loan are included. Added legal fees are additional; they are the responsibility of the company and will be deducted from the principal amount of the loan.

Basic Loan Application Requirements

Tab 1

1. Describe amount and purpose of loan
2. Project dollar amounts required (sources and uses)
3. Primary source of repayment

Tab 2

1. History and nature of business
2. Ownership structure
3. Key management personnel and experience
4. Products
5. Competition
6. Market area
7. Main customers
8. Main suppliers (Contact, Phone #)
9. Union relationships
10. Description of plant and facilities
11. Employment Impact Statement (Current and 3 year projection)
12. List of professional advisors (legal, accounting, banking)

Tab 3

1. Latest three (3) years financial statements
2. Latest three (3) years tax returns
3. Interim financial statements for borrowers
4. Financial statements of all significant stockholders or control owners
5. Credit Authorization Letter - Click here for Authorization Letter text

Tab 4

1. Three years projected year-end profit and loss statement
2. Pro forma balance sheet - after financing
3. 3 years projected year-end balance sheets
4. Other financial information as deemed necessary