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Council OKs LB840 loan for daycare center
McCOOK, Neb. — Thanks to the city’s LB840 revolving loan fund program, a long-time day care center will be able to stay open with a new owner.
“This is a fantastic use of the revolving loan program for an area (daycare) we desperately need,” said Andy Long, McCook Economic Development Corp. director at the city council meeting Monday.
Amanda Mullin, owner of Young Bison Childcare, is purchasing Kingdom Kids Daycare and has requested a revolving loan fund for gap funding for the purchase. The amount of the loan is $56,500 for 10 years at 3%. In addition to the loan, Mullin will finance the purchase of the building through a bank loan of $56,500. Kingdom Kids Daycare will carry the remaining $57,000.
The total purchase price is $170,000. The LB 840 loan will be secured by the property with MEDC/City of McCook assuming second position to the traditional lender, according the agenda report for Monday’s meeting.
Because the loan involved real estate, city council approval was needed. The MEDC board has already approved the loan, Long said.
The daycare has about 60 kids with the current owner, Kim Tietz, retiring, he said.
The city’s LB840 Revolving Loan Fund Program is financed through the McCook City sales tax. Of the 1.5% sales tax, half of the .5 percent goes to the MEDC, with a portion of that going toward the revolving loan program.
The council unanimously approved the loan.
Long also updated the council Monday night on measures to re-structure current loans in the LB840 loan program, due to the economic fall out from COVID-19 pandemic restrictions.
On April 3, Gov. Pete Ricketts issued a directed health measure (DHM) to all 93 counties in Nebraska in response to the pandemic; prior to Friday’s mandate, many counties were already under a directed health measure except for those in Southwest Nebraska and a few other areas.
The measure orders restaurants and bars to close their dining areas and only offer takeout or delivery and closes some non-essential businesses, such as hair salons. It also restricts gatherings to 10 or less people in one area. The restrictions are designed to slow the community spread of the coronavirus.
Long said for the re-structured loan payments, qualifying borrowers with the LB840 Revolving Loan Fund Program will be able to defer principal payments for three months and just make the interest payment. None of the principal amount would be forgiven, Long clarified.
Councilman Jared Muehlenkamp asked if there had been any interest in the re-structured payment and Long said a couple of borrowers have contacted him about it.