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PROPOSED ORDINANCE
AN ORDINANCE AUTHORIZING COOK COUNTY THROUGH ITS BUREAU OF ECONOMIC DEVELOPMENT TO ESTABLISH PROGRAM FEES FOR VARIOUS BUILT IN COOK LOAN PROGRAMS.
WHEREAS, the Cook County Board of Commissioners on April 17, 2013 approved a Resolution authorizing the Bureau of Economic Development to accept the U.S. Department of Housing and Urban Development (HUD) Section 108 Loan Guarantee financing which will launch the BUILT (Broadening Urban Investment to Leverage Transportation) in Cook Loan Fund in an amount not to exceed $30 million dollars; and
WHEREAS, this financing will provide Cook County (County) through the Bureau of Economic Development with the lending authority to support sustainable economic development for the benefit of low- and moderate-income individuals; and
WHEREAS, the Section 108 program is administered as part of HUD's Community Development and Block Grant (CDBG) program and is subject to the requirements governing the CDBG program; and
WHEREAS, it is permissible for Section 108 recipients to impose fees on third party borrowers who receive loans made with the proceeds of Section 108 loans; and
WHEREAS, if the purpose of the fees is to defray costs related to administering aspects of a Section 108 project, the fee should be treated as an applicable credit against administrative costs; and
WHEREAS, it is permissible by HUD that the County collect an application processing fee of $500.00 or $1,000.00 to defray the administrative costs of processing a Section 108 application and such fee will be treated as an applicable credit against administrative costs; and
WHEREAS, it is permissible by HUD for Cook County to charge third party borrowers an interest rate that is higher than the rate payable on the Section 108 loan (interest rate spread) and HUD encourages Section 108 recipients to use the interest rate spread as a reserve for interest rate fluctuations; and
WHEREAS, it is permissible by HUD that th...
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