The city of Marseilles and Twin Oaks Ottawa Savings Bank are partnering together to ensure Marseilles businesses get the financial support they need during the coronavirus outbreak that has left some businesses closed.
Mayor Jim Hollenbeck announced the partnership in a press release Wednesday and that they'll provide no-interest Community Development and Assistance Program (CDAP) loans for up to $10,000 per business.
As part of the effort to streamline and make funds available quickly, the usual and customary rules in the loan application process will be relaxed and, depending on an individual basis, initial payment under the loan may be temporarily deferred. Those with existing loans under the program are eligible provided payments on their existing loans are current.
Applications are to be submitted through the existing CDAP Loan Application Process.
"Teamwork is what we need right now and this is teamwork at its finest," Hollenbeck said in the release.
"Businesses aren't alone and we will be doing everything we can to support them," he later added.
Normal CDAP guidelines apply and can be found by visiting cityofmarseilles.com or calling City Hall at 815-795-2133.
Hollenbeck said the loan program will work as follows:
• Marseilles deposits $151,000 into a five-year CD and OSB pays .75% on the deposit.
• OSB loans $151,000 as a guidance line to draw down on as needed at 0%. The above CD is the collateral for the loan.
• Marseilles makes loans to owners based on guidelines in the program and recommends up to 5 years to match the CD term.
• City Attorney Richard Burton prepares a loan agreement for the terms that the City approves and documents any collateral requirements.
• Marseilles informs OSB of terms that have been extended to the borrower and OSB mirrors the transaction to the City in order to board on our system for tracking (we can send electronically for the authorized official to sign) a day or two notice should be fine. The loan will be available to view and track with online banking. Your office will be able to view for payments, past due and payoffs
• Marseilles requires an automatic withdrawal for the payment, OSB sets up the transaction to fund a checking account that will be used for borrowers’ payments or we draw up something that allows the us to draw the money on behalf of the City