Business and Entrepreneurial Development

Revolving loan funds, micro-loans, cluster based planning, value-added promotions, technology parks, e-commerce, virtual incubators, tax credit education, marketing campaigns, networking clubs, export feasibility studies and public facility ownerships are the directions these projects have taken to encourage and support regional business and entrepreneurial development.

Alabama Association of Regional Councils members are the beneficiaries of Alabama’s initiative to establish the Alabama Regional Revolving Loan Fund Program. The program’s $12,000,000 capitalization was obtained by a bond issue, which will be retired with cellular phone taxes. The state’s 12 regional councils, using the funds, have made 355 loans, leveraged $117,000,000 in conventional lending and produced 6,813 jobs at a cost of $3,776 per job. Each regional fund is capitalized at a level exceeding $1,000,000.

This value-added facility in South Dakota was developed with support from the East River Electric Power Cooperative Value-Added Loan Program.

The Sierra Economic Development District, in California, Foresters Co-Op and partners’ Biomass Utilization Business Linkage Program (BESTBET) uses technology to link entrepreneurs to resources. A contract with the Placer County Resource Conservation District (using California Proposition 204 funding) has supported the GIS mapping of the regional watershed (25-mile radius). The map provides links to producers and users of woody biomass material and is posted on BESTBET’s website for easy access.

Valley Oak Business and Technology Park encompasses 150 acres and was created by a partnership among Southern Kentucky Economic Development Corporation, Lake Cumberland Area Development District, local governments and a technical college. The park’s first speculative building was constructed at a cost of $2,000,000. This 20,000 square foot “smart” building will be equipped with high-speed telecommunications and extensive broadband connectivity. The park already houses one client, Northstar, potentially creating 150 jobs.

Androscoggin Valley Council of Governments and co-sponsors, Central Maine Technical College, Advanced MicroSystems, regional adult education offices and the Maine Small Business Development Center, developed a microenterprise Internet Incubator. The incubator is designed to build the region’s small business capacity, by creating new and larger markets via the Internet. Thirty businesses will create customized websites, attend three web-based trainings and have access to a technology consultant for one-on-one web design and maintenance.

Helping lenders understand the New Markets Tax Credit program, as well as offering them a simpler way of taking advantage of the program’s potential, were the objectives of the New Markets Tax Credit Education Program created by the Community Reinvestment Fund, Inc., in Minnesota. A national mailing to lenders about the program was followed by teleconference trainings explaining the program’s nuances in an easy-to-follow format. Web-based information, as well as frequent e-mail updates, helps keep lenders informed.

Minnesota’s Region Nine Development Commission received a grant from the State of Minnesota’s Department of Trade and Economic Development, after a tornado struck the region in 1998, to assist rural businesses. When the loans were repaid a new loan pool was created and called the Microenterprise Loan Program. Loans are offered for up to $25,000 with a five-year term and negotiable interest rates. Borrowers receive technical assistance from the Small Business Development Center (SBDC).

Increasing marketing and sales in selected new export markets for local value-added wood products manufacturers through a targeted research based marketing strategy is the primary objective of Ohio Valley Regional Development Commission’s Ohio Appalachian Hardwoods Initiative. Extensive market research identified the German and Japanese markets as two of the best prospects for hardwood exports. The commission has organized a successful trade show in Germany and is currently organizing Japanese furniture and home shows in late 2002.

The Entrepreneurs’ Club was developed by the North Central Pennsylvania Regional Planning and Development Commission through the Team-Pennsylvan!a Entrepreneurial Network Initiative. The club, now has over 100 business members, meets monthly to receive a lecture on entrepreneurial topics such as, finance and marketing. Networking at meetings is encouraged, e.g. a five-woman vending service for olive oil gained distribution contacts with a local restauranteur and wine/gift shop.

The Speculative Building Program began in 1989 under a partnership between Berkeley-Charleston-Dorchester Council of Governments, in South Carolina and the private sector to create jobs and attract investments. The program purchases properties ranging from 25,000 to 30,000 square feet and redevelops them into a “shell building” or basic building that can be easily and quickly customized to meet a prospective purchaser’s business needs. To date, five buildings have been sold creating 5,300 jobs and attracting investments of $1,200,000.

Lower Savannah Council of Governments, in South Carolina, determined feasibility of a six-county Regional E-Commerce Project, after sponsoring a focus group, public meeting and survey feedback. Feedback showed that the region’s small businesses had interest in expanding into e-commerce, but lacked technical expertise. The council is currently exploring funding options for implementation of a shared website. The site, “southernclique.com,” will function as a virtual shopping mall to market local products. This completes phase one of the project.

The Rural Electric Cooperative Value-Added Loan Program, by the East River Electric Power Cooperative, Inc., in South Dakota, and 22 electric distribution system members, has already provided $3,100,000 in zero percent interest loans to 1,465 producers. Producers have invested in six value-added projects, including five new corn-processing plants and one pork-processing plant. River East contributes 55 percent and system members contribute 45 percent. The fund has leveraged nearly $70,000,000 in equity.

The Small Business Loan Fund program offered by South Central Tennessee Development District was designed to fill gaps in other loan funds through flexibility. The development district received an agreement from First Farmers and Merchants National Bank to make a loan of $50,000, absorb the interest and add interest income to the fund. Applicants do not have to qualify for bank products. Nine loans have been made totaling $63,630.

The Agricultural Commodity Export Feasibility Study, reviewed the option of diversifying the port of Port Lavaca-Point Comfort’s petrochemical export business, by adding in direct agricultural exporting to Mexico. Golden Crescent Regional Planning Commission, with funding from the port and U.S. Economic Development Administration, hired a consultant to conduct the study. The study showed that the Mid-Texas Gulf Coast region, north of the port/Golden Crescent region, has sufficient commodity volumes and Mexican market demand to support direct agricultural exporting.

Virginia’s Mount Rogers Planning District Commission is encouraging use of state legislation that allows the region’s jurisdictions to jointly or publicly own, operate and share industrial site tax revenues via the Management Assistance (Regional Industrial Facility Authority) project. Two counties, under the authority, jointly purchased a 300-acre regional industrial technology park site and built the park’s first 87,500-square-foot-shell building. Funding sources have been local, state, the Appalachian Regional Commission and the Virginia tobacco settlement.

Award Winners Alabama Association of Regional Councils, Alabama Regional Revolving Loan Fund Program. Contact: Wayne Burnette, 5900 Carmichael Pl., Montgomery, AL 36117; 334/277-2221; fax 334/277-3899; email wburnette@adss.state.al.us; web www.alarc.org Sierra Economic Development District, Biomass Utilization Business Linkage Program (BESTBET). Contact: Betty Riley, 560 Wall St., Suite F, Auburn, CA 95603; 530/823-4703; fax 530/823-4142; email betty@sedd.org; web www.sedd.org Lake Cumberland Area Development District, Valley Oak Business and Technology Park Building Project. Contact: Stuart Carman or Donna Diaz, P.O. Box 1570, Russell Springs, KY 42642; 270/866-4200; fax 270/866-2044; email donna.diaz@mail.state.ky.us; web www.lcadd.org Androscoggin Valley Council of Governments, Maine Micro-Enterprise Initiative Program - Internet Incubator. Contact: Robert Thompson, Chris Logan or Jane Mickeriz,125 Manely Rd., Auburn, ME 04210; 207/783-9186; fax 207/783-5211; email clogan@avcog.org or jmickeriz@avcog.org; web www.avcog.org or www.advmcrsys.com/incubator Community Reinvestment Fund, Inc., New Markets Tax Credit Education Program. Contact: Frank Altman or Michael Blumfield, 801 Nicollet Mall, Suite 100 West, Minneapolis, MN 55402; 612/305-2052; fax 612/338-3236; email Michael@crfusa.com; web www.crfusa.com Region Nine Development Commission, Microenterprise Loan Program. Contact: Wes Judkins, P.O. Box 3367, Mankato, MN 56003; 507/389-8871; fax 507/387-7105; email wes@rndc.mankato.mn.us web www.rndc.org Ohio Valley Regional Development Commission, Ohio Appalachia Hardwoods Initiative. Contact: Jeffrey Spencer or John Hemmings III, P.O. Box 728, Waverly, OH 45690; 740/947-2853; fax 740/947-3468; email jhemmings@ovrdc.org; web www.ovrdc.org

North Central Pennsylvania Regional Planning and Development Commission, Entrepreneurs’ Club. Contact: Ronald Kuleck, Jill Foys or Don Masisak, 651 Montmorenci Ave., Ridgway, PA 15853; 814/773-3162; fax 814/772-7045; email jfoys@ncentral.com; web www.ncentral.com/~ncrprpdc Berkeley-Charleston-Dorchester Council of Governments, Speculative Building Program. Contact: Ronald Mitchum, 5290 Rivers Ave., Suite 400, North Charleston, SC 29406; 843/529-0400; fax 843/529-0305; email RonM@bcdcog.com; web www.bcdcog.com Lower Savannah Council of Governments, Lower Savannah Council of Governments E-Commerce Project. Contact: Eric Thompson or Jennifer Dole, P.O. Box 850, Aiken, SC 29802; 803/649-7981; fax 803/649-2248; email jdole@lscog.org; web www.lscog.org East River Electric Power Cooperative, Inc., Rural Electric Cooperative Value-Added Loan Program. Contact: Barb Strom, P.O. Box 227, Madison, SD 57042; 605/256-4536; fax 605/256-8056; email bstrom@eastriver.coop; web www.eastriver.coop South Central Tennessee Development District, Small Business Loan Fund. Contact: Joe Max Williams or Doug Williams, P.O. Box 1346, Columbia, TN 38402-1346; 931/381-2040; fax 931/381-2053; email dwilliams@sctdd.org; web www.sctdd.org Golden Crescent Regional Planning Commission, Agricultural Commodity Export Feasibility Study. Contact: Patrick Kennedy, P.O. Box 2028, Victoria, TX 77902; 361/578-1587; fax 361/578-8865; email gcrpc@icsi.net; web www.gcrpc.org Mount Rogers Planning District Commission, Management Assistance (Regional Industrial Facility Authority). Contact: Thomas Taylor or David Barrett, 1021 Terrace Dr., Marion, VA 24354; 276/783-5103; fax 276/783-6949; email ttaylor@mrpdc.org; web www.mrpdc.org

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