Region 9 receives $500K for loan program
The loan program that helped Cortez Cab, Guy Drew Vineyards and six other business in Montezuma County got an extra boost recently.
The Region 9 Economic Development District received an additional $500,000 through the Community Development Block Grant to help fund startups and keep businesses open throughout their five-county region.
“This CDBG funding has been key to assisting numerous small businesses that are unable to receive financing through traditional means,” said Ed Morlan, executive director of Region 9.
The loans are for businesses that struggle to get loans through banks because they don’t need a particularly large loan, are high risk or don’t have enough collateral to qualify, said Laura Lewis Marchino, assistant director of Region 9.
Region 9 requested the additional funding from the state because there is enough regional demand to loan out all the money before March 2015 when their contract will be up for renewal.
However, the demand for loans through Region 9 is not as high as it has been in recent years.
“If anything, we saw more usage during the recession because banks were not as able to loan,” Lewis Marchino said.
Since 2011, Region 9 has loaned out $1.089 million to 31 businesses and helped fund a feasibility study during this cycle of the grant. The grant has been awarded to this region since the 1990s.
The loan money passes through La Plata County to Region 9, which loans it to businesses La Plata, Montezuma, Dolores, Archuleta and San Juan Counties.
In addition to larger loans of $100,000 or more, the block grant program provides micro-loans to small business and entrepreneurs that can include up to $5,000 in grants for technical assistance. Region 9 considers the impact the business applying for the loan will have on the community and how many jobs it might create or retain.
Once the money is paid back to Region 9, it continues to be loaned out to businesses, Lewis Machino said. This funding is one of many sources for Region 9. The organization’s total loan fund is $4 million, and most of the money is currently loaned out, Lewis Marchino said.