With a $100,000 grant from the United States Department of Agriculture, Aitkin County Growth Inc. is hoping to extend a helping hand to area business.
Aitkin Growth, a non-profit, 501(c)(3) organization, is promoting the revolving loan funds as a chance to spur economic development opportunities in the area. The loans can be used for several different purposes, from building out current projects to acquiring land. The terms of the grant funds requires them to be distributed in the first year or they will not be available again.
A meeting was held Jan. 23, one that drew representatives from Aitkin and Aitkin County. The purpose of the meeting was to brainstorm what the money could and should be used for, and figure out how to best reach prospective applicants.
Among those in attendance was Matt Shermoen from Area Partners for Economic Expansion, a business development group that has operated out of the Duluth area for northeast Minnesota and northwest Wisconsin since 2004.
“We help pull all the partners in,” said Shermoen.
The $100,000 from the USDA Rural Development Revolving Loan Fund can be lent to businesses who are looking to expand. According to Aitkin Growth, qualifying projects:
• Must be physically located in Aitkin County, with a potential waiver if the business will have a positive economic impact on Aitkin County.
• Businesses applying must be private endeavors with fewer than 50 employees.
• Include technical assistance for private business enterprises, loans for start-up costs and working capital, construction, conversion, enlargement, repairs or modernization of buildings.
• Have a goal of adding or retaining at least one full-time job for each $10,000 lent from the RLF.
• Acquisition and development of land, easements and rights of way.
The RLF cannot be used for repaying existing loans, agricultural projects, comprehensive planning, or another partially funded portion of a project unless that money has been previously secured.
Barb Carr from Aitkin Growth said this week that no loans have been submitted to the USDA yet. The first step in the process is to create a DUNS number, directions for which can be found on the Aitkin Growth website at aitkingrowth.org.
“We do have some interested, but the money is still available,” Carr said. She added that the money is generally available for a lower interest rate, depending on the person applying for the loan.
At the meeting, Carr and the rest of the gathered guests discussed what the obstacles could be for bringing a new business into Aitkin County – and how the revolving loan fund could potentially help break down those barriers, which include everything from not having a plan fully built out to not having the courage to move forward.
Rick Herman, who owns McGregor Log Home Wood Fired Pizza, came to the meeting looking for some guidance. He said he needs better equipment to expand his business, but has struggled to find funding because traditional banks aren’t necessarily eager to help new businesses.
Tim Woodrow of Goble’s Sewer Service in Aitkin was at the meeting, and is on the RLF committee with Aitkin Growth.
“Banks look at physical assets you can sell. They don’t look at dreams,” Woodrow said. “We can finance the dream portion a little bit.”
Carr added that this past week, “Aitkin County Growth has a history of working with local banks to partner together on the loan package for area businesses and we look forward to continuing that relationship as well.”