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Economic Development Success Stories Slide 2 EIP GRANT PUBLIC INFRASTRUCTURE Slide 3 Page 3Economic Development | 12-3-09 Upson County Innoware Plastics, Inc. Recipient Upson County Sub-Recipient Innoware Plastics, Inc. Grant Amount - $375,000 Project rail spur Private Investment - $7.1 Million Jobs 30 jobs Slide 4 Page 4Economic Development | 12-3-09 Source and Use Upson County SourceAmountUseAmount EIP$ 375,000Rail Spur Construction$ 352,500 Grant Administration$ 22,500 OGA Equity$ 500,000Site Preparation$ 200,100 Land Acquisition$ 194,112 Rail Spur Construction$ 105,788 TUCIDA$ 500,000Rail, Road, Eng, Land Acq, Admin$ 500,000 NSV$ 80,000Rail Switch/Turnout$ 80,000 Innoware$ 7,081,400Building Upgrades, M&E$ 6,600,000 Rail, site Prep, Eng, Admin, Env$ 481,400 Total$ 8,536,400Total$ 8,536,400 Slide 5 Page 5Economic Development | 12-3-09 Upson County Slide 6 EIP GRANT LOAN TO PRIVATE FOR-PROFIT BUSINESS Slide 7 Page 7Economic Development | 12-3-09 City of Harlem Lucky Lady Pecans, Gifts & More, Inc. Recipient City of Harlem Sub-Recipient Lucky Lady Pecans, Gifts and More, Inc. Grant Amount - $ 157,058 Project Machinery & Equipment Private Investment - $ 253,504 Jobs 20 Slide 8 Page 8Economic Development | 12-3-09 Source and Use City of Harlem SourceAmountUseAmount EIP$ 157,058Equipment$ 147,658 Grant Administration$ 9,400 Private$ 253,504Equipment$ 253,504 City$ 1,000Audit$ 1,000 Total$ 411,562Total$ 411,562 Slide 9 Page 9Economic Development | 12-3-09 Making it work Underwriting public financing requires: Flexibility Keeping an eye open for potential Remembering the public purpose Looking at the whole project Not a rigorous quantitative scoring method! Slide 10 Page 10Economic Development | 12-3-09 C REDIT I NDICATORS: Sales Trends Profitability Management Cash Flow Trends Working Capital Adequacy Capitalization Industry Conditions Years in Business Business Plan D&B Rating Equity Injection into project Bank Participation in project Cash reserves/lines of credit Personal credit of principals Slide 11 Page 11Economic Development | 12-3-09 Business Plan: Description of Business Form, type, product/service Marketing Plan Customers, market analysis and trends, competition Management Plan Background, experience of principals, personnel needs, employee benefits Financial Plan Budget, working capital adequacy, break-even analysis, historical and projected financial statements Slide 12 Page 12Economic Development | 12-3-09 So where do you draw the line? SOLVENCY PROFITABILITY Solid Credit High Risk GREY AREA Slide 13 Page 13Economic Development | 12-3-09 Positive Attributes of a Successful Project Strong Management Access to Capital Marketplace Opportunities Targeted Industry Strong Commitment by Local Leadership Slide 14 REDEVELOPMENT FUND Slide 15 Page 15Economic Development | 12-3-09 City of Donalsonville Recipient City of Donalsonville Grant Amount - $150,918 Project Demolition and Clearance of the vacant dilapidated building in historic downtown. Private Investment - $23,000 City - $113,281 Slide 16 Page 16Economic Development | 12-3-09 SourceAmountUseAmount RDF$ 150,918Demolition$ 129,000 Engineering$ 12,867 Grant Administration$ 9,051 Holley Estate$ 23,000Donated Land/Bldg.$ 23,000 City$ 113,281Parking Lot construction$ 89,075 Engineering$ 8,941 Contingencies$ 15,265 TOTAL$ 343,591TOTAL$ 343,591 Source and Use City of Donalsonville Slide 17 Page 17Economic Development | 12-3-09 City of Donalsonville