MICHIGAN CITY — Last week, the Michigan City Common Council unanimously approved amendments to an ordinance creating a revolving loan fund available to local businesses.

The appropriation of $650,000 of riverboat money was approved by the previous council in 2010 and has been set aside specifically for the use of a revolving loan fund. Untouched to this point, Councilwoman Pat Boy said the previous director of the Economic Development Corporation Michigan City never pursued the fund any further after the money was appropriated.

Boy, who authored recent amendments to the ordinance along with Councilman Don Przybylinski, said while the money was appropriated, it was never turned into an effective program.

“It was designed for companies that were planning to leave Michigan City,” Boy said, adding the loan program was to be an incentive to keep companies in town. “But now it can even be used to attract more businesses and new jobs.”

With the recently accepted amendments, loans will now be available to new and existing businesses.  However, those businesses must be located in Michigan City or within a half mile of the city limits with a voluntary annexation agreement.

The ordinance, Boy said, is a cooperative agreement between the council and the EDCMC. While the money was appropriated by the city, the economic expertise of the EDCMC will be used to make decisions about the loans.

Real estate investments will have terms of 10 to 15 years while loans for machinery and equipment will be five to 10 years. Loans will be distributed with a maximum of $260,000 and a minimum of $10,000.

According to the ordinance, eligible uses of the loan fund are the purchase of machinery or equipment; the purchase of buildings and land for prospect operations; construction, repair and renovations of buildings; operating capital, including inventory and work in progress; and quantifiable employee training when state and federal grants have been investigated and exhausted.

The loans will be approved through a five-person committee — two appointed by the mayor, two appointed by the common council and one will be the EDCMC chair or his designee.

Businesses interested in pursuing assistance through the revolving loan fund may contact the EDCMC at (219) 873-1211.