Small Business Development Loan Program

The mission of the Small Business Development Loan Program is to lend to new or existing small businesses that will locate or expand in Canandaigua for the purpose of attracting jobs and commerce to the area.

Loan Policy

Funding Eligibility and Limits:

The City will start with a $250,000 investment in loans not exceeding $50,000 and not less than $5,000 for the following activities:

• Property acquisition, construction, or infrastructure improvements

• Purchase of equipment, fixtures, and furnishings

• Leasehold improvements

Loans for less than $10,000 will have an expedited approval process.

The funds cannot be used for working capital such as salaries, rent expense, or the purchase of inventory.

The interest rate will be 2% over the life of the loan, and the maximum term will be 60 months. The loans will be fully amortizing with no balloon payments.

Applicants are required to contribute funds to the project. The loan cannot exceed 75% of costs.

Selection Criteria:

The funding of projects will be a competitive process awarded according to the determination of a Loan Committee. Funds will be awarded to projects that have the greatest likelihood of creating a desired economic impact within the city. The following categories will be assessed in the loan approval process:

• Adherence to the City’s Comprehensive Plan

• Potential job creation

• Owner’s equity contribution to the project

• Project readiness

The applicant must demonstrate to the Loan Committee’s satisfaction a commitment and intent to repay the loan, and an ability to repay the loan. The borrower must be current in all tax payments at all levels, including any approved plan to pay taxes and fees

Security:

Security for loans will be indicated on the completed application and adequacy will be determined by the Loan Committee on a case by case basis. Every loan will be collateralized to the fullest extent possible. Each loan will be personally guaranteed. Owners of 20% or more of the assets of the business are required to personally guarantee a loan made to that business.

Fund Administration:

The Loan Fund is administered by the City of Canandaigua, and Canandaigua National Bank & Trust Company.