City of Jacksonville Revolving Loan Fund

Goals & Objectives

The city of Jacksonville Economic Development Revolving Loan Fund (RLF) is established as a requirement of the Illinois Department of Commerce and Community Affairs (DCCA) in approving prior or new loans submitted to DCCA. The RLF can be structured in a manner the City deems necessary to meet the goals described, providing basic requirements of DCCA are met.

The funds recaptured from the Community Development Assistance Program (CDAP) economic development loans will be used to capitalize a revolving loan fund to further economic development.

The purpose of the RLF is to provide gap financing for existing businesses locally, as well as, out of town businesses wanting to locate in Jacksonville.

RLF funds may be used to assist for-profit and not-for-profit organizations to carry out economic development projects. Generally, RLF funds will be loaned by the City to the borrower (business or not-for-profit organization) at agreed upon terms. (Not-for-profits must document the need for receiving assistance which may be in the form of a grant and/or loan.) RLF funds may not be used as loans to help service or refinance existing debt. In addition to using RLF funds for low interest loans, RLF funds may be used to finance public facilities and improvements in support of economic development (e.g., water system upgrading to serve an expanding business).

Specific Goals and Objectives

  1. Stimulate economic growth in the City of Jacksonville by assisting with the retention and growth of the existing industrial base, providing needed equity to new startup businesses, encouraging the development of minority and female owned businesses and providing an incentive for established businesses to relocate to Jacksonville.
  2. Assist new or existing Jacksonville businesses create and retain jobs.
  3. At least 51% of all jobs retained or created must benefit low to moderate income persons as determined by State of Illinois Income Limits.
  4. Increase the City’s property tax and sales tax base.
  5. Provide businesses with the opportunity to expand.
  6. Encourage and leverage loans to businesses by area private financial institutions.


If the RLF is included as part of a financing package involving DCCA, SBA, or another governmental agency, as well as a financial institution and the City, the loan may not exceed fifteen (15) years to coincide with the length of the governmental agency loan. If the RLF package involves the local financial institution and the City, the length of the loan will be determined by the financial institution, not to exceed fifteen (15) years. The minimum interest rate is to be 3 percent.

The maximum loan will be 40% of the total project not to exceed $150,000 when the RLF is made in conjunction with DCCA, the Small Business Administration (SBA) or other governmental agency, as well as a financial institution and the City, provided the project results in the creation of at least 75 new jobs.

If the loan is to be made with a financial institution, the maximum loan will be $50,000 or 30% of the total project.

A business or industry must create or retain at least one permanent full time job for each $10,000 of revolving loan funds received by the firm.

The City Council and Mayor have the option of increasing the loan beyond the maximum listed above if it is apparent that it is necessary to secure a major business that will have a major impact on employment. However, the RLF loan cannot exceed $200,000.

The City Council reserves the right to negotiate all terms of all loans, based on size and scope of the project and its financial impact on the local economy.

Any changes to the loan program must be approved by a resolution from the City Council.


  1. The loan must be approved by a financial institution.
  2. A letter on the financial institution’s stationery, stipulating the equity by the borrower, the extent of the financial institution’s participation, the terms of the loan, the rate of interest to be charged by the financial institution, and the amount of gap financing required by the City, must be submitted to the Community Development Director.
  3. A letter from the firm, on the applicant’s stationery, which states what the RLF money will be used for must be submitted.
  4. All loans are predicated upon financial feasibility – this will be determined by the applicant’s financial institution as to financial statements presented to them for approval of the loan.
  5. In no instance will a loan exceed 50% of the total project cost.
  6. A business or industry must create or retain at least one permanent full time job for each $10,000 of revolving loan funds received by the firm.
  7. The geographic area served by this fund will be within the corporate limits of Jacksonville or within the mile-and-one-half zoning boundaries outside the corporate limits. No loan shall be made under this program to any company presently located or having plans to locate outside the corporate limits unless an agreement to annex the property is entered into. Should the site not be contiguous to the corporate limits of Jacksonville, the recipient of the loan shall sign an agreement to petition for annexation if and when the site can be legally annexed to the City.
  8. The funds will be targeted to assist the existing industrial base, startup businesses, female and minority owned firms and established businesses that will relocate to Jacksonville on an as needed basis and dependent upon fund availability. Applications that demonstrate the greatest potential for job creation and meeting the goals and objectives of the funds will be given highest priority.

Eligible uses of funds

  • Acquisition and Rehabilitation of real estate.
  • Site development infrastructure extension costs.
  • Construction of new facility or additions.
  • Renovation of existing facilities.
  • Leasehold improvements.
  • Purchasing, moving and/or installation of new or used machinery and equipment.
  • Working capital, general operating expenses.
  • Inventory.
  • Financing public facilities and improvements in support of economic development.

Ineligible uses of funds

  • Refinancing or consolidating existing debt.
  • Paying off a business’ creditors.
  • Purchase or renovation of residential space, new housing construction or income payments for housing or any other purpose (e.g., housing allowance).
  • Funding projects started prior to the loan being approved.
  • Buildings or portions thereof, used predominantly for the general conduct of government (e.g., city halls, courthouses, jails, police stations, etc.).
  • General government expenses.
  • Costs of operating and maintaining public facilities and services (e.g., mowing parks and replacing street light bulbs).


The RLF program will be administered through the Mayor’s Office. The RLF Administrator will coordinate the program with the Jacksonville Regional Economic Development Corporation and the Jacksonville City Council. The administrator will make available to the City Council all necessary information as required to evaluate each request. Furthermore the RLF Administrator will meet the applicant, meet with the institution representative of the participating lending institution, visit the site if necessary, negotiate terms, length, security of loans, and compliance with the RLF goals and objectives. The City Council will formally approve or deny the applications.

The RLF will be staffed by the RLF Administrator, the office of Economic Development and the City Attorney. The participating financial institution packages and conducts financial analysis for the loans.

The loan documents, including commitment agreements, liens, title policies, security recordings, transfer tax declaration, amortization schedules and security releases, shall be obtained and completed by the City Attorney. The City’s RLF Administrator shall monitor payments of the loan, job creation and/or retention reports required to be provided by the business until the commitment is met, monitor other special conditions required by the loan and submit semi-annual reports on the status of the RLF to the Department of Commerce and Community Affairs.


Not more than 10% of the annual revenue to the RLF will be used for administration of the RLF funds.

Assistance provided from the RLF will result in at least 51% benefit to low and moderate income persons and these benefits will be documented via JTPA or employee income certifications found in the RLF handbook.

The City of Jacksonville agrees to report semi-annually on the status of the RLF to the Department of Commerce and Community affairs.

Any changes to the recapture strategy will be submitted to the Department of Commerce and Community Affairs for approval.

In the event of a bad loan, legal steps will be taken to recover RLF funds.

A complete set of books is kept for all RLF financial activities.

Periodic checks on employment are made and recorded in an employment file for all recipients.

All Employee Income Certification Forms will be retained in a separate file for each company to check against the application to verify that 51% of the employees hired qualify.


All funds received by an applicant from either a CDAP or the City’s RLF must meet the 51% L/M Income Guidelines as prepared by the State of Illinois.

The applicant must project the total employment needs for the first year, consisting of retained as well as new employees. Whatever combination of new or retained employees, the total must indicate that at least 51% of them meet the income guidelines for Morgan County.

A semi-annual certification of employees from the recipient is required to indicate positions created/retained. This listing will be checked against the projected employment as indicated in the approved application.

If the employer fails to provide said certification, or upon receipt of a certification which shows the employer has fallen short of the job creation/retention projections, a letter will be forwarded to the employer, asking for a written explanation as to why the assurances have not been fulfilled.

After receipt of the letter, a meeting will be scheduled with one or more appropriate persons from the employer, at which time the RLF Administrator of the City could ask further questions that might arise from the certification and the letter received from the employer.

After gathering all this information, a decision will be made by the RLF Administrator, the Mayor and the Finance Committee as to whether the City should take some particular action.

If the decision is made to take action against the employer, the appropriate action would be for the City to notify the employer that unless the job creation/retention assurances are met within a specific period of time, the City will demand full payment of the outstanding loan balance.

If the deadline for job creation/retention and 51% guidelines are not met within the specified period of time, then the matter will be referred to the City Attorney for legal action to collect the debt.

Category: Low Interest Loans

Provides gap financing and seed money for existing Scott County businesses, as well as, any company wanting to locate in the county. The RLF program was established in 1964 through local investments.
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One of six CDC’s formed as part of the U.S. Department of Commerce & Economic Development Administration pilot program in December 1988. The Tri-County CDC was organized to provide gap financing and seed capital loans to retain and create employment in Morgan, Cass, and Scott counties. It is a for-profit corporation consisting of investors from 12 area banks throughout the region, the city of Jacksonville, the Jacksonville Area Chamber of Commerce, and Illinois Rural Electric Cooperative.
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