The harsh cold winter weather has become a distant memory replaced by warmth, the noise of construction, and optimism for what the balance of the year has to offer. In recent months we’ve spent time with some other optimists and entrepreneurs, committed steadfast to their trade yet at times struggling with the challenges of growing a business. While you may hear more about our work with larger organizations and developers, we’re equally honored to support growing local businesses.
In this month’s Huddle Up, I’ve asked CFCFA Vice President Rose Roman to write about our lending programs available to assist small businesses in need of capital for investment in fixed assets, such as building purchases and renovations. We’ve heard from the community that small businesses struggle to secure financing to support business growth. We responded by investing capital into these programs.
Our challenge is connecting with prospective borrowers. Are we able to lend to everyone? No – like any lender, we need to consider the borrower’s ability to repay the loan. Can we be flexible, collaborate with other lenders, and work with the local community to try to identify other resources that can fill gaps to support the business’ growth? Absolutely!
In fact, we may be able to create customized lending programs for specific communities. We might consider expanding lending guidelines to meet unique community priorities.
Rose and Matt Lima manage our small business lending portfolio and take exceptional care of their clients. We have low-cost, long-term, fixed-rate capital available.
More program information follows. Let’s put Rose and Matt to work!
– Patty Huddle, President
Great Rates for Small Business
According to a recent FAQ from the U.S. Small Business Administration’s Office of Advocacy, there are more than 36 million small businesses in the United States. They employ 62.3 million people and pay nearly 39% of total private sector payroll. The resulting economic activity makes up 45.9% of GDP.
Given small business’ importance to our economy, Columbus-Franklin County Finance Authority has established two innovative programs to support small business financing needs. The first is our Neighborhood Improvement and Small Business Loan Program.
Loans from $75,000 to $750,000 are used for fixed-asset investment, such as owner-occupied commercial real estate, heavy manufacturing equipment, or multifamily affordable housing projects. Loan terms run with the useful life of the asset and the rate is a low fixed rate of 4.50%. Given CFCFA’s regional approach, we’re able to make these loans anywhere in the 11-county Columbus Region with the support of the local community.
There are many examples of this program in action, including Glamm Dentistry, a woman-owned dental practice; Distinctive Kitchen & Bath, a local dealer and fabricator; and Community Development for All People, a South Side nonprofit. These links explain how we assisted each of them.
The second program is our Commercial Property Assessed Clean Energy Program. C-PACE loans range from $200,000 up to $10 million (or more in limited circumstances). These loans support energy-efficiency improvements for nonprofit, commercial property, or multifamily housing renovations located within the Columbus Regional Energy Special Improvement District (ESID).
They can also support owners choosing more efficient materials in new construction. The loans are secured via a special assessment that runs with the tax bill. It’s not a mortgage – instead, the structure provides an innovative financing tool for many small businesses looking to make needed improvements while not leveraging the balance sheet.
For small C-PACE loans up to $2 million, CFCFA currently offers a LOW FIXED RATE of 5.5%. Senior lenders must provide lender consent.
Examples of PACE lending include Bridgeway Academy, 400 N. High Street, and even the Toledo Museum of Art. To learn more about PACE, this interview with local advocate Colin Kalvas provides lots of details and insights.
In addition to small businesses, developers and non-profit organizations may qualify for NISB and C-PACE. For more information on these unique programs, please reach out to Rose Roman [email protected] or Matt Lima [email protected].
Happy spring!
– Rose Roman, Vice President