City Secures Additional Funds for Commercial Loan Program

Austin, Texas (February 14, 2007) – The City of Austin received $3 Million from the U.S. Department of Housing and Urban Development, through its Section 108 Loan Guarantee Program from the U.S. Department of Housing and Urban Development (HUD), to serve businesses through the city's Neighborhood Commercial Management Loan Program (NCMP).

The NCMP was established in 1990 to create or retain jobs for low- and moderate-income individuals by providing financial assistance in the form of low-interest loans to existing small businesses in the form of GAP Financing. Borrowing entities may be eligible for GAP financing for up to 40% of eligible project costs, not to exceed $250,000 (minimum $10,000). The primary goal of the program is to create or retain job opportunities for low- and moderate-income person by providing financial assistance to existing commercial businesses located in the Eligible Program Area seeking to expand or enhance their operations.

To be eligible to receive funding under NCMP a business must have been in operation for two years or more, be able to create or retain jobs, and be credit worthy according to standard loan underwriting guidelines. The program requires at least one job be created per $35,000 in loan monies and the job must be maintained for a minimum of two years. Eligible projects include: acquisition of land and improvements, construction of new building leasehold improvement; and acquisition of machinery and equipment necessary for the operation of the business.

In addition to staff analysis, every approved loan application is required to go before the NCMP Loan Committee which comprises of members from financial institutions, real estate, commercial, and business professions as well as one community representative and one representative from the Community Development Commission. All loan requests that are greater than the City Manager's authority are also brought before the City Council for approval.

To apply for the program, contact the Neighborhood Housing and Community Development Department by phone, 974-3167, or e-mail, nicholas.johsnon@ci.austin.tx.us.

The City of Austin is committed to compliance with the Americans with Disabilities Act (ADA) and Section 504 of the Rehabilitation Act of 1973, as amended. Reasonable modifications and equal access to communications will be provided upon request. Please call 974-3100 (voice) or 974-3102 (TDD) for assistance. This project is made possible by funding from HUD through the City of Austin.

CONTACT: Jackie Mayo, AHFC, 974-3121 (voice), 802-7108 (pager)