Revolving Funds

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Revolving Funds

North Central Illinois Council of Governments provides technical assistance to local governments that have revolving fund programs.

A revolving fund loan is a financing tool that is used to bridge the gap between the dollar amount a bank will loan for an eligible activity and the financial need of a business and/or property owner. Borrowers pay back RF loans (plus interest) to the local government, which then provides loans to other private sector firms. Thus, it is a “Revolving Fund.” Although a “local” fund, the RF program’s monies never lose their state and federal identity and can be collected if the program is mismanaged.

These programs were established utilizing federal Community Development Block Grant dollars to provide reasonable term loans at an attractive, blended interest rate to existing and potential business and property owners as a means to encourage investment. Programs are aimed at creating and retaining jobs, particularly for low-to-moderate income individuals. Programs are governed by a variety of state and federal regulations in addition to locally adopted policies.

Listed below are common goals for a local revolving fund:

  • Stimulate economic growth by assisting with the retention and growth of the existing industrial and commercial base, providing needed capital to new start-up businesses, encouraging the development of minority and female-owned businesses.
  • Assist new or existing businesses with creating and retaining jobs.
  • Ensure that jobs created or retained by business applicants benefit a minimum of 51% low-moderate income households in the area.
  • Increase property tax and sales tax base.
  • Provide businesses with the opportunity to expand.
  • Encourage and leverage loans to businesses by area private financial institutions.
  • Create or retain one Full Time Equivalent (FTE) job for every $15,000 of revolving funds provided. (FTE are positions consisting of a minimum of 1,950 hours worked in one year).

On April 5, 2012 the North Central Illinois Council of Governments with the assistance of the Small Business Development Center hosted a Revolving Fund workshop.  Fred Walker of The Walker Group was the presenter for the workshop.

The presentation chapters are available for download at the bottom of this page. Also available for download are the 4 Volumes of the most recent RF Manual.


RF Presentation Introduction (458KB | .pdf)

RF Presentation Chapter 1 (1152KB | .pdf)

RF Presentation Chapter 2 (692KB | .pdf)

RF Presentation Chapter 3 (930KB | .pdf)

RF Presentation Chapter 4 (859KB | .pdf)

RF Manual Volume 1 (1301KB | .pdf)

RF Manual Volume 2 (1189KB | .pdf)

RF Manual Volume 3 (890KB | .pdf)

RF Manual Volume 4 (809KB | .pdf)