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hi good morning thank you so much for joining us my name is Johanna Nelson and I am with the New Mexico an Economic Development Department and you have tuned in for a really great session today this is a part of our kovat 19 response webinar series and today we are talking with a really fantastic partner of ours and that is the New Mexico Finance Authority and they will be talking about their essential service working capital program which is a new program that they have created and tailored to address kovat 19 relief so really excited to have them and and for them to be sharing their time and expertise with us and I want to thank you again for for joining in I do want to cover a few things before we get started I want to mention that this webinar is being recorded so you will be able to access this recording after today's presentation we also will be sending this presentation out as a PDF so all of the links that you will see and the information that will be available to you after the presentation we did receive your questions that you submitted when you registered so we will do our best to address those after the presentation and during the presentation please if you have questions feel free don't hesitate to type those in and we will do our best to get to those as well I did want to go over a few things from the economic development department just so to make sure we've been saying these every webinar but just to make sure that awareness is is out there about some of the programs that we have so in in regard to our kovat 19 response we do have a few programs for businesses one of them is a business loan guarantee program we can guarantee up to 80% of the double amount or up to $50,000 and so this is you working with a lender and we will partner with that lender and guarantee the amount we're not making any loans but this helps with guaranteeing the the loan to the lender so that they will make loans and these are for projects that have been negatively impacted by the the health crisis we also have our local Economic Development Act Lita we have a 0% interest loan program this is the program that is put into place by by our Constitution of the state so we are limited by particular guidelines you do have to be an eligible entity but if you do qualify you can use this loan to pay for expenses related to land building our infrastructure and something that has been applicable during this this period is you can use this loan to pay for lease payments or mortgage assistance as well there is also the New Mexico recovery fund this is a program that is being run out of Sun Mountain Capital this is for medium sized companies if you have more than 40 employees I would encourage you to reach out and explore that to see if it's a fit I mentioned our webinar series we are averaging about a webinar once a week this week is a busy week for us we have several webinars going on so I did put those here we will be having two webinars on Thursday which is tomorrow our outdoor division director AXI novice will be discussing a newly announced program called the outdoor equity fund and that will be tomorrow at 11:00 our Main Street program will be discussing the perfect time for building and site improvements and that'll be at 2:15 and they've been hosting webinars every Thursday which is a really great resource and I do want to mention when we put this recording up on our YouTube channel it's a fantastic depository of all previous webinars that we've had so I will go ahead and put the link to our YouTube channel and you can see not only the webinars that we have been doing during the health crisis and addressing Cove in nineteen relief programs but you can also see previous webinars that we've done prior to to the health pandemic that address financing programs and opportunities we have a bye for tomorrow today website hopefully you already know about this but we created this website to help businesses put their business on a website and enable customers to purchase gift cards to their to their business to help with cash flow we know because of of closures that many businesses are extremely suffering right now due to limited our no cash flow so this is a way that customers can help and purchase gift cards it is free to register we have over 600 businesses statewide so if you haven't already this is this is a great opportunity to list your businesses and engage with customers here is the contact for the economic development department I put mark ropers contact he is the division director he also manages the zero percent Leda interest our zero percent interest loan program you can reach out to him I put my contact you can reach out to me with any questions about the guarantee program and then you can access the entire staff at this link and I also put a map of the EDD regional representatives these folks represent the department in all regions of the state they live in these areas and are the the face and and the boots on the ground for the department they're an excellent resource to help with technical assistance questions direct you to the right organizations and the right help that you need for your businesses so if you don't already know these folks feel free to reach out and chat with them if you have needs or questions I also finally wanted to make sure that we point out that the 2020 census is in full swing it's it's more important now than ever for folks to be counted if you haven't already please take a little bit of time it takes a few minutes to fill out your census this is incredibly integral to any type of federal funding assistance that the state receives and the more folks that we can count the the better off the better position that New Mexico can be in when we we are competing for assistance so without further delay I want to turn it over to New Mexico Finance Authority and introduce John Brooks so John you want to go ahead and get started sure Thank You Johanna we are thank you for allowing us to have at this time to work with you guys on this you have been a great partner and throughout the years and we look forward to continuing our partnerships throughout the next upcoming years so before I get started just I wanted to do is just introduce myself my name is John Brooks have the managing director of the commercial lending department at the finance authority and we are looking forward to talk to you today about the essential service working capital program it is a new program that we put together to help with the code relief in the state of New Mexico especially those considers essential services but the governor and I'll go through some of the eligible project a little bit about the Finance Authority and our mission statement our mission statement advances New Mexico by a financing impactful well-planned projects explains what we what we do at the Finance Authority we want to be able to help the state of New Mexico and the the folks in New Mexico to be able to enjoy some of the fruits of your of our labor by having great projects such as the one that's pointed out in this particular slide but also of all the projects you know that potentially could come through the Finance Authority to help move a New Mexico forward and and help live in New Mexico be a thriving state um a little bit about a New Mexico Finance Authority and some of our history as you can see the Finance Authority was created in 1992 to help a plan coordinate and finance public projects since 1994 the finance authority is financed over 2 billion projects throughout the state in Mexico and so those projects include infrastructure projects building projects economic development projects throughout this state and specifically in 2003 the final authority brought in some of our powers through financing powers doing the statewide economic development finance force well foot and this allowed the fines authority to partner with the Economic Development Department to offer projects they'll take public dollars and finance it for public projects or private projects excuse me for private projects with this act this allows us to do what we're going to talk about today the essential service working capital because we are looking to help out those private businesses that are in need during this time so a little bit about the essential service working capital program and and how it works the finds Authority is looking to offer emergency loans for essential service providers or essential service and essential businesses that need operate an operational capital or working capital during this I health crisis him and and basically helped these businesses to be able to continue to operate during this time the funding is available for for-profit businesses and also for nonprofit organizations the loan amounts to be up to a million dollars based on borrowing capacity the loan terms with up to five year maternities we could do lines of credit up to one year and also term loans in up to five years and I'll go to more information about the terms and and how these how each one of the line of credit and also our term loan works later on in this presentation also we can secure the loans through receivables and other personal property of the borrower that interest rates are going to be at 1% and this is oh I want to emphasize this is a loan program it's not a grant program and we don't have any grant monies available at this time to help out there during this emergency crisis and due to limited capacity we are it's going to retail businesses at this point in time so if we are able to later on evaluate the fun and see if to see if retail businesses are eligible we may make that changes but right now retail businesses are not eligible so a little bit more about the program and how it works starting off with the eligible entity list as you can see on this list we have different types of businesses that are are eligible to apply for the program started with rural hospitals behavioral health providers of healthcare facilities dinners pharmacies research facility child care facilities and and you can see the list on this particular page the reason we are focusing on sort of the behavioral healthcare and medical care providers because when the PPP program was established we noticed that there and for those businesses that took on Medicare revenues they were not initially a part of the PPP program or eligible of part of the PPP program but since then they they became eligible but but but we also noticed that these businesses are are in need of working capital of financing also as what's good about this particular program if these businesses that are listed here receding the PPP program it does not exclude you from applying for the essential services working capital program so so we we will be able to help out those that they receive those particular funds so types of organizations and use of funds the types of organizations that are eligible to apply or for-profit corporations and also 501 C 3 nonprofit corporations so both for-profit and nonprofit corporations are eligible in terms of eligible uses for the essential service working capital fund it is a working capital program and so we are looking to help out with operational expenses such as purchase applies a payment of utilities or similar bills payroll payment payment and rent or mortgage so these are the things that are eligible for so it is not eligible for a purchase of capital equipment facility renovations or even if you're looking to purchase a built in these are some of the expenses that we we are not looking to in this particular program we do have other programs that can help out with those other type of expenditures but this particular program is based on operational expenditures based on the knees at this point in time so the first type of loan that we can make in this particular program our working capital term mount a working capital term loan is what it is says is it's a term loan that will help out with some of your operational needs the maximum loan size is 1 million dollars and that's going to be based on your request and your ability to of to make that paint the repayment of the 1 million dollars so we'll look at the financial capacity of the borrow to repay the loan and as I mentioned earlier the interest rate is on this particular program is going to be 1% that is going to be fixed for the life of the loan and so it is not a variable rate loan for the application when you apply there is no application or closing cost and so that is something that will benefit the borrower in this particular transactions the loans will be secured want to land on a available business assets so and you know in terms of looking at the viability of the loan and the ability to repay the loan of course we want to look at the cash flow of the the business but we also look at our collateral and the collateral must exceed the amount of the boun any party they owns 20% of interest in an organization will be required to personally guarantee the loan but in in those cases when the applicant is a or member or a nonprofit organization there is no guarantee that is required so this is the the term loan structure and we we are taking applications for this term bone structure on the next slide we're going to talk about is the working capital of lines of credit initially the lines of credit or will be established for a six months with an approval and if after that six months if a company needs additional working capital means they can request to an additional six months so for a total of twelve months is possible through a line of credit final credits will at the end of the six month or 12-month term will be converted into a term loan and once it's converted to a term loan the principal and interest payments will begin at that point in time so with any working capital by the credit the payments on the line will be based off the amount borrowed and the interest payments on on the mount borrow so that so for example if you have a hundred thousand dollar line you brought ten thousand one percent of the ten thousand is a hundred dollars and that would be your payment and once it's converted then that will that will change the the new term loan will be repaid over a period not to exceed five years so once you occur once you convert your working capital loan into a turn bone you have an additional four years to pay off that loan the lines of credits will be secured by receivables and other personal property again of the borrower the interest rates at one percent and again no application or closing fees and there is no prepayment penalty so if you are in a position of pay off the line of credit then you can pay it off at any time in terms of the project application and to complete the application and and the timelines in which you will have to get the application into the Finance Authority the applications are due every third Friday of each month until the money runs out we only have 12 million dollars in this program and therefore the funds are limited the application process and an approval process takes approximately a month and if you need the funds faster than that month please contact the MFA is staff and we will determine if emergency request is available you can send all applications to business at NMFA net and you can also reset to get the application from www MFA EF now our staff is dedicated to respond back to any emails or business requests within two hours of receiving the application and also later on this slide there is some contact information that you can use to contacting to myself or Ryan olguin we will be there to answer any questions so what happens next so once you determine you are an eligible entity you also determine that you need you need a assistance with some of your operational needs how do you apply and what are the steps in a client so number one you can again contact the NMFA at business at NMFA dotnet we will help the borrow determine if they're eligible through conversations if the eligible if the borrower is eligible you can submit an application online and staff will receive the application and begin processing your application a staff will the NMFA staff will review the application for readiness and contact the borrower if we need additional information one
a financial analysis has been performed and we determined that we could continue to move forward we will create a write-up that will go before the NMFA or review process that is a two three step process which includes an internal credit committee in a Economic Development Economic Development Committee which is a subset of the NMFA Board and then the NMFA board for a full review of the process then this process seems it we will work with the borrower through each part of the process to make sure that you understand where we stand with the application and the if the application is approved by the NMFA aboard we will we will contact the borrower and begin closing on the loan after the process after the board has approved the loan you know hopefully we could get it closed within a timely manner after or approved and so we can be able to provide the funds to the borrower and so again this is a short presentation we thank you for your participation here is some of our contact information on today's topic you can email business at NMFA net or you could talk contact myself at John Brooks RJ Brooks at NMFA net or RINO gainer at ro ro ghena in a methane f so with that I stand for questions at this one time thanks John that was that was short and sweet really good information so I'm going to read you some questions and I'd like to encourage anyone if you have questions feel free to type those in this is your chance to talk with talk with the expert and get all the information you need so one of the first questions that we had was let's say let me pull pull up the screen let's see what what information do businesses need when they are applying is there there's some advice that you can offer the businesses of the information that they need to gather before they begin this application process sure so some of the information we need in order to process the application is at least two years worth of financials if you don't have two years with the financials we will also be we would like to see a profit or loss statement for the current year also we would like to see some of the organizational documents such as the articles of the corporation and all the documents that are associated with the business and then also if they have other loans we would need some of that information just to make sure we have a accurate debt profile and if they also apply for the PPP program we just want to make sure we meet their timing as the PPP program runs out we want to make sure we have the money available during the at the time that the program runs out that program funding runs out okay great thank you in that application you mentioned they can access that online any idea how about how long it take can they save it while they're applying yeah there's a PDF application so yes so they can save it so it's a easier form than doing it online so you just download the application fill it out and send it to the email that this is that intimate rate now you know one thing I want to add too if you make sure if the borrowers can add in their key employees of the organization's so we could have that information as well as we go through the application process okay great thank you we got a couple of questions John about I think these are more general but they are speaking to what what loan programs does an MFA offer so it might be a good opportunity if you want to share a little bit of insight into all the you know really briefly all the the other stuff you guys do that help businesses and communities sure so in MSA has 16 different programs and those programs focus on from public communities to economic development so I'll I'll step through some of the programs that we have on the public side and then I'll step through some of the programs that we have on on the private side so starting with the public side we do have a program called a public project revolving fund which is our flagship of a flagship program it is designed to provide a local community such as municipalities counties tribal governments any public body with the act the ability to borrow money at a triple a rate so the borrower is getting low cost of funds based off of our our bond rating that we receive the the loans could be up to you know amount of the project it is it is secured by either the gross receipts tax of the community or the let's say net system revenues of the water system or wastewater system it could be any type of public project that a public body can offer now our request one of the things about this particular program is you do have to be on our authorization list and so any project that's over a million dollars we do require legislative authorization and you could give a hold of one of our regional finance managers they can add you to that list so this project so this program the PPR f is our flagship program and is designed to assist any public body with any capital needs some of those capital needs could be equipment building infrastructure building a project infrastructure project anything underneath the Sun look we've qualified the next program I want to talk about is our drinking water revolving loan fund program that is a revolving loan fund program that is designed to provide safe drinking water to public bodies some of the the loans are now at 1% and and you have to be on our part the priority list that is put together by the new mescaline economic in New Mexico Environment Department along was assisted so the New Mexico Finance Authority so once your unplaced on a priority list we can get money out to you for water related project another program we have is the water trust board the water trust board is a grant loan combination program where we can assist with water projects throughout the state and in Mexico I'm just I'm sorry I there's so many programs so just bear with me the colonias infrastructure programs again it's a infrastructure program to those entities that are designated as colonias and i believe the the designation is a hundred and fifty miles from the Mexico border and then on top of that we have a planning grant program called the local government planning grant that allows public bodies to get a planning document put together so that's the planning document includes a program engineering port for your water system or plans the specs for your water system you could do an economic development plan you could do any type of feasibility study plan and all these items are listed on our website so you could determine what if if you're eligible or if you planned and eligible and you look it up on our website so these are some of the programs that we have on a public side on the private side we have a program called smart money which is a loan participation program in which we help finance private and private businesses for some of them happen EADS so that could be purchase equipment building or working capital deeds through that particular program then to you the unique thing about this program is that we have to work with your local bank to participate in their loans so you start off with contacting your bank that then the bank will work with the Finance Authority in order to provide financing for this project um we can participate up to 49% of the financing and so you know we'll you could contact the Finance Authority about that particular program as well also we have another program called a new market tax credit program which allows tax credit investors to invest in a project that is located in a low-income census tract again you you would need to contact the final authority staff or the Economic Development Department staff to see if your project is located in an eligible census tract if it is then we can work with you and providing financing for that particular program through our particular program we are look we will probably be open up around coming up in the end of June these rounds are allocate a particular amount of tax credits to a specific project right now we have I believe 12 million dollars remaining in the program in terms of allocation and and so we will be offering that up in a competitive cycle coming up pretty soon and we'll get that information out as well and then finally we have the essential service working capital program as we talked about so those are some of the programs that that we have and those are the main programs that we operate at the Finance Authority you you hi there I'm sorry I couldn't get my my microphone off mute thank you John that was we were putting you on the spot you just you you deserve a very good grade on rattling off all of the work that NMFA does you you guys are amazing and in doing so much alright so we had a question this is this is kind of a general question too but is there and you kind of answered this but there's a question coming in from Leia asking what kind of assistance do you offer to rural communities so do you want to highlight anything specifically around rural communities and businesses is there anything I'm sorry sure yeah so to answer that question all of our programs are designed around rural rural areas and we we tend to incentivize rural communities through the various either interest rate reductions or we assiniboins them some type of way and in terms of getting more rural projects completed in in the state of New Mexico so I mean it's it's so it's I mean I want to say that we do focus on rural areas of the state and we want and some of our best partners are located in the rural areas of the state so that's a tough question to say you know we offer advantages throughout rural New Mexico thank you we had a question come in from from Deborah about is the NMFA willing to discuss opportunities to partner with private equity investors to increase funding to answer a question of the finest authority does evaluate all of our programs and evaluate other sources of monies that we may be able to collaborate with to fun either one of the programs that we have or to discuss the opportunity of creating a new program so we would you know look at other equity partners and see if if there is a way that we can make it work and keep it in mind that we want to be able to provide access to all New Mexicans through this particular program through equity investors so it's something we have evaluated and at the management level okay thank you we had a question come in from one asking about the I think the previous program that has kind of morphed recently the the new market tax credit loan program do you want to give an update on on that where you guys are on or where you guys are at with that sure so we have recently looked at the new market tax credit program and try to figure out a way how we can offer a new market tax credits to smaller projects throughout the state of New Mexico and so you know without going into too much details behind the scenes what we determine is that there are projects that are under four million dollars throughout the state of Mexico though that needed could take advantage of the new market tax credit program and so what we did is we created it a new program called the small loan pool program through new market tax credit and what that program does is allow the Finance Authority to invest take equity dollars invest into a project that's located in a state that's under four million dollars now you know the uniqueness about that particular program is that you don't get some of the principal forgiveness like the main new market tax payer program but what you do is you get low-cost financing through equity investors buying down the there's interest rate cost in the program and also lower cost of funds so it's a program that we are rolling out it should be out in the next several months we do have the rolls of policies in place we just have to decide when we're going to open up a cycle and I think that cycle will be part of the June cycle that's coming that will go under release at the end of June it's exciting okay thank you John and let's see we just got a question come in from gene in let's see if I do this question justice so it says do your interest rate does your interest rate reduction include building renovations that include electrical mechanical and monies for architectural proposals for redesigning building spaces pretty technical question all right I'm gonna take this question in two different parts I'm gonna start from a public perspective and then I'll talk about in a private perspective so in a public perspective depending on where the project is located the project may what we call get market rate so the market rates are based on one of the rates that that are given to the final authority based on the market condition at that point in time and so when we issue bonds and to replant it them to reimburse ourselves for the loans that we make we've we get we translate you know give the borrowers the race that we receipt you at the time that we issue those bonds now the you know the uniqueness about the program is if a borrower is located in a disadvantaged community then there are opportunities to get lower interest rates so that could be either at zero percent or at two percent or at three percent depending on their project location so that's from the public perspective on building infrastructure from a private perspective and through our loan participation program we again based on our interest rates on the US Treasury rate so right now currently what I looked at the Treasury rate a few days ago a ten year rate was at point five nine percent and we will mark it up based on risk and so risk would include company risk management risk industry risk and then interest rate risk or structural grace so how much structure you know how complex the structure will be that we're financing we have a maximum markup on on that particular program which is called smart money of about two to have basis points above the prevailing matron market rate so in a case where the interest rate is at point five nine the you know the worst case scenario is a barroom would be borrowing a loan at three point zero nine percent so that is the way we you know do our interest rates we do depending on the program there are competitive rates based on where the project takes place and if the area is considered disadvantaged and then we will lower the interest rates based on that so it's just you would have to contact in MFA staff and then we could work with you to determine what that rate would be okay great thank you and I have one final question and this is more getting your insight on and in you know creating a discussion around it but are you seeing anything out in the field right now as as PPP has hit funding is coming in for that you mentioned it earlier and as we're moving into this kind of uncharted territory and and kind of uncertain times can you give any any advice for businesses that are looking for financing at this point moving forward as as they're kind of weighing some of the the options that are out there maybe some of the the challenges that you're seeing them faced with do you want to kind of give your perspective on that what we have seen so far from the authority's perspective as as businesses have received a PPP or not have received the PPP program one thing I would say is number one I would I would not leave any stone unturned so what I mean by that is take a look at all the programs that are available I know that the Economic Development Department has a pretty good list of programs on their website and I we encourage you to take a look at that list because there could be a program that might fit your needs and then number two I would you know I would not be I would not hesitate them pie and different programs I think that that is the key to successfully manage the your needs and to be able to apply to the different programs and and don't hesitate and I'm pie into some of the programs I think that that is a way to address some of the needs that you may have currently or even upcoming also I think reaching out to various folks I know one of the a lot of people are unaware that the Finance Authority has funds available for different projects or also for businesses and you know for example you know as I talked about Smart Money earlier it is one of the programs that we we offer low cost of funds there were participati
n with the bank and also you know look you know learning about some of the other programs that we have it you know such as new market tax credits and also our small loan pool and and then also stay in communication with your bankers you know a lot of people think that bankers are not pay attention paying attention during this time but actually they are and they are concerned about keeping the economy strong in the stay in New Mexico a lot of the community bankers and bankers that we have talked to are in the same boat and trying to figure out how they can help businesses to be able to stay afloat during this time and also during the future and I think that you know having open channels to all the different barriers the different avenues through the state will allow the business didn't be successful at this time I just you know could urge people to be open minded not and and try to be patient during this time and you know hopefully we could be able to help a business you know get through what we consider is you know unprecedent time thanks John you were you raised some really good points and you you remind me that I did put the link to a previous webinar that NMFA conducted which I don't even remember was that last summer sometimes it was a while ago but still relevant where we had three representatives from NMFA John included discussing these programs in depth I think that actually that webinar hit a record for us of of longest webinar that we've done so far but it's because they just went into such detail and gave such explanation great explanation about the different programs that they have so that's a really good resource if you want to follow up - if you have questions and want to kind of explore at your own pace so feel free to do that and then also John had given a another webinar about the new markets tax credit program and that is available on our YouTube channel and we'll put those when we send an email out which I we've gotten some questions about the the presentation we will be sending this presentation out you'll also get a link to the recording but will also will include those two previous webinars that NMFA has has conducted as well so I want to thank you so much John for your time thank you - to all the staff at NMFA you you guys do such incredible work you're such an important partner and create such such an impact in the state like your your mission on here says so really great to work with you and just want to echo what John already mentioned that there are lots of organizations out there that are ready to go and ready to help right now so so you do have to be open and just reach out and reach out to us reach out to - John and the staff at NMFA and we'll we'll help how best we can so thank you John and we will talk to you soon thank you all for tuning in Thank You Johanna and I everybody stay safe and you know hopefully we can be able to provide assistance during this time great thank you take care take care
