Marseilles Mayor Jim Hollenbeck has announced that the City of Marseilles, working with Twin Oaks Ottawa Savings Bank is taking action to help ensure that Marseilles businesses get the financial support needed to get through the COVID-19 Crisis.
The City of Marseilles has teamed up with OSB Twin Oaks to provide NO-INTEREST CDAP (Community Development & Assistance Program) loans for up to $10k per business. Teamwork is what we need right now and this is teamwork at its finest. Normal CDAP guidelines still apply and can be found by accessing the application at www.cityofmarseilles.com or by calling Marseilles City Hall at 815-795-2133.
Mayor Hollenbeck stated businesses aren’t alone and we will be doing everything we can to support them. First payments can be deferred up to six months. The loan program will work as follows:
- City deposits $151,000 into a five-year CD and OSB pays .75% on the deposit
- OSB loans City $151,000 as a guidance line to draw down on as needed at 0% - the above CD is the collateral for the loan
- City makes loans to owners based on guidelines in the program- recommend up to 5 years to match the CD term
- Attorney Burton prepares a loan agreement for the terms that the City approves and documents any collateral requirements.
- City informs OSB of terms that have been extended to borrower and OSB mirrors the transaction to the City in order to board on our system for tracking (we can send electronically for authorized official to sign) a day or two notice should be fine, loan will be available to view and track with the online banking, your office will be able to view for payments, past due and payoffs
- City 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
In all reality, OSB is making the City a 0% loan that they can loan back out and the get paid .75% on the deposit, we are in essence taking care of the tracking of the loan made to the borrower for the City.
OSB will be absorbing the actual costs of each transaction that the City creates from this program and will be providing the City a loan at 0% secured by the CD that they will be able to loan out at 0% or whatever rate the City wants to charge.