Wisconsin Department of Commerce Newsletter
Revolving Loan Fund Provides Assistance for Wisconsin CommunitiesSuccessful local development projects depend on effective partnerships. In pursuing their economic goals and objectives, many Wisconsin communities have used the Community Development Block Grant for Economic Development (CDBG-ED) program to help businesses structure financial packages necessary for a start-up or to expand present operations. These loans are repaid directly to the community and may be used to capitalize a community Revolving Loan Fund (RLF).
An RLF assists the community in carrying out its economic development goals and objectives, provides private investment toward the assisted activity, and most importantly, creates job opportunities.
Advantages to businesses are very attractive "tailor-made" loans, which may include deferred payments and reduced interest rates. These loans are typically smaller loans that can be more efficiently administered at the local level.
The Department of Commerce will conduct its annual RLF workshop April 22, 2004, for communities, administrators, and individuals new to the program. Last year, 35 individuals attended the workshop which covered RLF program policies and procedures.
During the past few years, several small RLF communities have contracted with their county RLF for administration of their local RLF program, and in some cases, consolidated their program into a county program.
Commerce encourages smaller communities to consolidate their RLF into a single countywide RLF program, providing an effective tool for promoting regional economic growth and development. Consolidation ensures the maximum use of the resources and benefits in every community in the county, provides a larger capitalization of the RLF, and creates a more cost-effective approach, as counties are equipped to administer and manage the RLF program. Recent examples of county-wide consolidation are the five communities in Marathon County and two in Sheboygan County that have benefited from merging their RLF program.
The June 30, 2003, semi-annual CDBG-ED RLF reports indicate local RLFs have received over $116 million in CDBG-ED loan repayments, a five- percent increase above December 31, 2002. The current RLF loan portfolio exceeds $128 million, a six-percent increase above December 31, 2002. RLF cash reserves are $49 million, a seven- percent increase above December 31, 2002. (See chart above.)
For more information on consolidating to maximize the benefits to your RLF program and to register for the RLF workshop, contact Dan Ramsey at (608) 267-9383 or firstname.lastname@example.org.
The newsletter is issued electronically every other month.
Please send comments or questions to Barbro McGinn, editor.