MONROE — Recent notice by the state Department of Administration means the city must decide whether it returns the amount given to it to establish a revolving loan fund sooner or later, affecting how much it can retain by instead applying for grants.

The DOA decision in September was approved at the federal level. 

Members of the Monroe Common Council had to consider how to proceed during their April 1 meeting at City Hall. As part of the Revolving Loan Fund Program, funds were given to the city to establish a loan fund that would bolster economic development within the city. 

City Administrator Phil Rath said the program was considered successful. The city distributed $1.2 million in loans over its lifespan. Monroe was first given an investment of $750,000 in 1989. It was subsequently given an additional $187,500 in 1996.

 Any municipality that received funds after 1992 must return all of its money on hand as part of the program. All outstanding loan balances must also be returned. 

Rath said the city currently has two loans, a total of $937,000, in rotation. Rath said the time table will depend on whether the city chooses to “buyout” the loans and return $1.29 million to the program, or act more quickly and return $200,000 to be applied for as a grant. All funds must be returned by Jan. 31, 2021.

The returned funds can be re-distributed as grants to the entity which previously held them as part of the program. Applications for grants have to be for specific projects, but can vary from construction projects to water and sewer work and could even be used for a project within the proposed Redevelopment Authority district as long as they meet requirements for grant funding. It could not be applied for without a specific purpose. 

Rath said the city could apply for up to three project grants if it agreed to buy the loans and send in the full amount. The city would have two years to apply for project funding and Rath said capital planning projects would be considered soon, meaning fully-formed ideas for applications could be developed within that timeframe.

If the city were to decide against applying for grant funds by Feb. 1, 2021, it would lose any access to the funds it had previously returned from its RLF. 

Aldermen voted unanimously to recover the loans and return over $1.2 million to the state program.