January 5 2022
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Dover – Kent County is considering accelerating economic development in the new year, and a new loan program could pay dividends to the local economy.
Kent Levy County Court is looking into a new revolving loan program in December that will use a mix of public and private funds. If approved, Kent County will invest $750,000 and Discover the bank It will add another $250,000. Share National Development Council (NDC), the program could leverage $1 million to generate $4 million in lending capacity with the U.S. Small Business Administration.
No formal agreement has been signed between Kent Levy County Courthouse, National Development Board, and Discover Bank as of January.
Linda Barkowski, Executive Director of Economic Partnerships at Kent, described the program as an analogue of Excite Sussex, which has seen massive success since its launch in 2017.
“My counterpart Bill Pfaff [the Sussex County Economic Development Director] He called me and asked why Kent doesn’t have a revolving loan program,” Barkowski told the commissioners on December 14.
While the Kent Levy County Court has blessed the program, the county has not signed an agreement with the Community Enterprise Development Center that sets out the loan amounts offered, interest rates and the purpose for which the loans can be used. The revolving loan program will not be established until the Chief Justice of Kent Levy County Court signs the agreement and the county transfers its share of the funding. No timetable has been set, according to county officials.
Once a business is selected for a potential loan, the NDC requests tax returns and other financial data for the initial application. The NGO Development Center may visit the company’s website, and once the loan is approved, they can monitor the company’s financial statements to understand cash flow and stability.
Discover is committed to helping people achieve a brighter financial future. This mission extends beyond our customers and extends to the communities in which we live and work. James Roskowski, president of Discover Bank, told the Delaware Business Times that we are excited to be able to help growing businesses in Kent County.
Discover Bank and NDC are longtime partners in creating revolving loan programs, with the two entities launching the Grow Wilmington Fund in 2014. The initiative loaned $4.2 million to eight companies, while maintaining or creating 78 jobs.
But perhaps the biggest success to date can be found in Sussex County, where Excite Sussex has been the equalizer for many of the county’s recent gains. With the original joint investment of $1 million from Sussex County officials and Discover Bank, the program has issued $5.1 million in loans so far to five companies, affecting 102 jobs.
Recipients of the Excite Sussex loan include $1.4 million to Millsboro’s Tail Bangers; $985,000 for paving the peninsula; $850,000 for JAYKAL LED Solutions and $755,000 for Showtime Powersports.
Earlier this year, Sussex County Council approved $3 million to replenish the fund. So far, the NDC estimates that the program has also been able to achieve this. $16 million in small business loans.
This program is open to Sussex County companies that have been in business for at least two years and employ 10 to 50 people. Companies eligible for the Sussex County Revolving Loan Program are required to have operated for at least two years, with 10 to 50 full-time employees. Loan sizes can range from $250,000 to $1,000,000 and can be used for equipment, real estate, renovations, and tenant improvements.
“We’ve really seen a huge impact across the state, but we’ve also seen incredible commitment from Sussex County,” Conor McCarthy, NDC’s chief loan officer, told Kent County officials. “We’ve been able to really use that money to target specific areas that they don’t really need to attract or retain business.”
In the past, Kent County primarily relied on two tools to attract business to central Delaware: the Tax Reduction Program and the Strategic Development Fund.
The county tax cut offers a 10-year plan that reduces county property taxes by 90% for the first year, and decreases by 10% annually thereafter until you reach the 10% limit in the ninth year. Companies must invest at least $1 million in a new facility or renovations and hire at least 10 employees to qualify.
The Strategic Development Fund can be used for business loans, working capital, equipment purchases, start-up costs, and more. The fund was created in the late 1990s after the government. Tom Carper allocated the money through windfall state gains, but it found little use until recently. Levi’s court ruled Delmarva Corrugated $75,000 And Loyalty to the United States of America $10,000 last year.
Barkowski was very confident in her ability to successfully offer the revolving loan program to companies looking to expand.
“One of the companies in our portfolio will certainly be using this,” she told commissioners in mid-December.