Port revolving loan fund needs applicants

Lincoln County economic development authorities are looking for applicants to take advantage of the more than $200,000 currently available in a revolving loan fund for new and expanding businesses.

The fund stems from a $200,000 Community Development Block Grant obtained by the county in 2000. The grant helped finance the establishment of Kootenai Paving. When the business changed hands in 2004, the loan was paid off and the money rolled back into a revolving loan fund amounting to around $254,000 with the accumulated interest.

The fund is overseen by the Lincoln County Port Authority and administered by the Kootenai River Development Council. Loans are available for business enterprises countywide, said KRDC director Paul Rumelhart.

"I think a lot of people think it's just to be used at the port property, and that's not the case," Rumelhart said.

The primary focus of the fund in manufacturing, Rumelhart said.

"Retail is typically not fund by revolving loan funds because of the inherent conflicts in the community that occur," he said.

Loans are available for three basic purposes, Rumelhart said. Loans for equipment are typically financed for the anticipated life of the equipment, which is normally seven years. Loans to provide a line of credit or working capital are typically made for three to five years, renewable annually. Loans for construction or building improvements can be financed over a 20-year period.

Loans from the fund require a minimum 50-percent match from a financial institution. The maximum loan amount is tied to the number of jobs created or retained, using federally established guidelines of $35,000 per job. At least 51 percent of those jobs must be in the low- to moderate-income range.

KRDC works with the borrower and the financial institution to package loans, Rumelhart said. Required paperwork, which KRDC can help prepare, includes an explicit business plan and estimated income statements, balance sheets and cash flow statements. The last three are required to be presented for three years, with monthly statements for the first year and annual statements for the second and third years.

Current interest rates are fixed at 6 percent. Additional federal funds can be leveraged through a regional partnership with Lake County, Rumelhart said. As loans are made and paid back, available funding will increase.

Rumelhart said he encourages anyone interested in applying for funding to contact the KRDC at 293-8406 or stop by the offices in the Memorial Center.

"We really want to grow the revolving loan fund, and you can't grow it if it just sits there," he said.