Hampton business loan fund

Hampton business loan fund

Purpose
The mission of the program is to provide capital for business, community and economic development purposes with the goal of creating jobs and encouraging private investment.

Loan Goals

  • To assist in providing sources of capital for the attraction, retention and expansion of new and existing businesses that may or may not have access to conventional financing;
  • To assist in creating jobs and investment, increasing business ownership, supporting community and/or economic development initiatives, and economic self-sufficiency within the City of Hampton.
  • To stimulate the redevelopment of under-utilized and/or deteriorated commercial and industrial properties in Hampton;
  • To provide “gap” financing in situations where a conventional lending institution is unable to fill the total capital needs because of lending limits, collateral requirements or other risks; and
  • To provide business loan guarantees and/or interest rate buy downs to aid commerce and/or the creation of new jobs and investment in the city.

Administering Body
The Hampton Economic Development Authority administers this program. The Hampton Economic Development Department provides support.

Who May Apply
Hampton business owners and/or commercial property owners that meet the program’s eligibility guidelines.

Policy for Considering Assistance Requests
Loans
Applications are considered on a based on the ability to secure sufficient cash flow and/or collateral to guarantee the loan repayment. Personal and/or business assets, real estate, vehicles, securities, Enterprise Zone job grants, the assignment of government contracts, and cash value of life insurance are examples of collateral that may be accepted.

Submissions
Prior to submission all applicants should meet with Hampton Economic Development staff.

  • Completed application
  • Financial statements and income tax returns for the previous two years.
  • Most recent interim financial statements of the applicant and where applicable, of its parent company, certified by officers of the respective companies.
  • Most recent interim financial statements for self-employed, Limited Liability Company and Subchapter S applicants.
  • Most recent interim financial statements of the guarantor, when applicable.
  • Two year projects pro-forma balance sheets and cash flow statements. Cash flow analysis should be reflected on a monthly basis for a minimum of two years, or six months beyond the break-even point, and should reflect the applicant’s ability to repay debt service out of earnings.

Type of Assistance Offered
Loans
The minimum loan amount is $3,000 and generally will not exceed $250,000. The program can be used for loan guarantees up to 50% of the loan or $50,000, whichever is less.

Eligible Uses

  • Financial costs associated with acquisition, construction, expansion or the rehabilitation of a commercial or industrial facility. Projects involving construction shall be in compliance with all state and local codes and regulations.
  • Machinery and other equipment and associated installation costs.
  • Working with capital to finance inventory, government contracts, premiums on performance bonds or funds to obtain performance bonds for contractors obtaining contracts performed in the city of Hampton, accounts receivable, mobilization, wages, season business fluctuations and the like.
  • Any loan or portion thereof to be used to finance premiums on or funds to obtain performance bonds shall be subject to such conditions as the EDA, at its sole discretion, shall determine.
  • Every project will be evaluated for the value of its improvement, extent/scope of work proposed, and its potential economic impact. The review will consider the following aspects:
    • Increase in marketability of the real property
    • Increase in tax revenue
    • Decrease in vacancy rate
    • Level of private investment by property owner
    • Consistency with an adopted City or EDA plan