City loan recommended for bar, tea shop spaces in Batavia
The owner of a North River Street building could receive a low-interest loan from Batavia for repairs and renovations as a bar and a tea store prepare to move in.
Aldermen Tuesday supported loaning River Street Buildings LLC up to $58,500 for 27-29 N. River St. River Street Buildings will also continue to receive a $25,000 grant from the city that aldermen approved in October 2015.
The loan is to be repaid over five years at an annual interest rate of 2.75 percent.
The council will take a binding vote May 16.
Alderman Dan Chanzit, who works in the banking industry, asked how the interest rate was determined, saying it is much lower than current commercial rates. City administrator Bill McGrath said when loaning money the city, historically, has aimed to charge about half the commercial rate and no more than 3 percent for such loans.
Last year, River Street Buildings LLC principal Bruce Harris estimated it would cost $58,650 to put in new doors and windows as part of the build-out for Bar Evolution. The bar is a project of tenant John Hamel, owner of the nearby Pal Joey's restaurant.
But part of the roof needs replacing, and the door and window replacement is being extended to accommodate The Tea Tree. Project costs have risen to an estimated $108,500.
In April, the council awarded a Downtown Improvement Grant of up to $9,500 to The Tea Tree's owner for plumbing work.
In September 2015, the city approved a $25,000 grant and a five-year, $25,000 loan for Hamel for interior remodeling for Bar Evolution.
The money for the grants and loans comes from property taxes collected on land in tax-increment financing District 1.