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ELKINS -- Elkins City Council officials declined on Monday to get involved with an "emergency loan fund" for small businesses, citing the financial uncertainty caused by the COVID-19 pandemic.
Dave Clark, executive director for the Woodlands Development Group, spoke before council's Finance Committee during a virtual meeting Monday, requesting funding for Woodlands Community Lenders, a loan group supporting small businesses.
"We're what's called a CDFI or a Community Development Financial Institution (and) there's about 1,000 CDFIs across the country," said Clark. "There's six in West Virginia. We do lending to small businesses that either can't get financing from a conventional bank or they can't get all they need."
Local businesses that Woodlands Community Lenders have assisted include TipTop Coffee, Big Timber Brewing and Counter Culture Concepts.
"What I'm proposing right now is this emergency loan fund," Clark said. "This emergency loan fund I'm proposing would allow for … low interest, very flexible loans of up to $10,000. These really would be these bridge loans to help businesses get to bigger loans… if they need them."
"They'd be very flexible with a quick turnaround. It would also be very risky, obviously. We don't know how long this is going to last or how it's going to look when we get out on the other side of all of this," he said.
The city was asked to pledge money to a loss reserve on the chance that the loans "go bad" so the lenders could pay back the banks.
"Typically, we would account for 6 to 10 percent of the loan fund to be put into a loss reserve as that backup. In this case, we're saying as much as 40 or 50 percent," Clark said.
Committee members said the city couldn't take part in the project due to the lack of financial certainty in the near future.
"I guess, given the current financial situation of the city and the unknowns that are involved, we have kind of taken the position that we're holding everything steady until we see what's coming down the road," said Second Ward Councilman Charlie Friddle.
"I personally commend your effort to get this done, (although) I really don't think the city's in a position to be contributing money at this point."
• Also during Monday's meeting, City Treasurer Tracy Judy proposed various budget adjustments for the 2020 fiscal year.
In the General Fund, money was moved within the department of the Phil Gainer Community Center to cover unexpected refunds and reimbursements during the COVID-19 pandemic.
A total of $1,850 was taken from the Capital Outlay line to cover these expenses, where bond payments, "which haven't started yet," had originally been budgeted, said Judy.
Other General Fund revisions included moving funds within the police department to pay for computer software, and moving funds from the salary and travel lines of the City Clerk department to pay for supplies, dues, advertising and "overtime/extra help."
Monies were moved within the sanitation fund to cover new computer software.
"What we're doing as far as the computer software, you'll see the increase of $10,000. We are trying to get everything, all the billings that we have for computer software, to come out one time a year," Judy said.
These budget revisions will be put to vote before Elkins Common Council during an upcoming meeting. The next Council meeting will take place virtually via Zoom on Thursday, April 16 at 7 p.m.