R2022-83 Resolution Authorizing the City Manager to Enter into an Agreement with Land of Lincoln Credit Union for Property Rehabilitation Program Services

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Decatur in the amount of the principal loan for each eligible loan dispersed to landlords for the purposes of purchasing materials for home improvements Contractor's Loan Fund:The Contractor's Loan Fund will provide access to capital for small contractors that may not have the cash flow for payroll, materials, supplies,transportation, lodging, etc.,to take on the owner-occupied rehabilitation program.This will help small contractors build personal credit and build their capacity as a business, which is critical to the success of our housing initiatives.The general terms of the contractor's loan fund are as follow: • Contractor will submit a cost estimate for work to be performed for the owner- occupied rehabilitation program to the Neighborhood Revitalization division. • The cost estimate must list separately the price of materials and the price of labor. • Once project has been approved by the Neighborhood Revitalization division, Contractor must open a savings and checking account with Land of Lincoln Credit Union before loan approval; Contractor may draw up to the maximum cost for materials only based on original and approved cost estimate. • Contractor will be offered a flat interest rate at 3.25%; no minimum credit score required. • Contractor will pay 1%administration fee which is based on the total project cost. • Terms of the loan will be up to 72 months. • The program will become a revolving loan fund to be used for future owner- occupied rehabilitation projects. • In the event of borrower default,the city will exercise all legal options against the contractor and the contractor will be placed on our disqualified contractor's list. The city also will hold harmless Land of Lincoln and pay the loan back in full to Land of Lincoln Credit Union.