The Free Press, Mankato, MN


February 5, 2014

Birthing center advances with St. Peter loan

First facility
of its kind
in the region

ST. PETER — A proposed birthing center is advancing closer to construction with the approval of a $65,008 loan by the St. Peter City Council, which acts as the city's economic development authority.

St. Peter resident Erika Urban is planning to establish the River Valley Birth Center at 526 West Park Row by reconstructing a home into an advanced facility. Urban has been providing midwife services for the central Minnesota region since 2009. The facility will allow her to expand her operations from four to six births per month to 10-12 births per month.

The facility will be the first birthing center of its kind in southern Minnesota.

The EDA loan was granted Jan. 13 to Urban's new corporation JAEL Properties, which was formed to run the birth center. The loan will finance 27 percent of $240,821 required for the project.

The terms of the loan will not provide the funds in a lump sum. Instead, Urban will have to contribute $25,813 of her own money to the project. The loan's funding will be withdrawn at the same rate as Urban's spending of her personal funds. The loan is amortized over 20 years with a 3 percent interest rate and a balloon payment for the entire loan after 10 years. Urban will only be required to pay the interest on the loan during the construction of the facility.

The remaining $150,000 in funding will be covered by a $135,000 loan and a $15,000 line of credit from Pioneer Bank. The bank will have the first mortgage on the house and the city will have the second mortgage. Similarly, the bank will have the first security position on the equipment and the city will have the second position.

Note: a previous version of this story incorrectly identified birthing center applicant Erika Urban as Erika Johnson.

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