Grow Worland business funds ready to help businesses

WORLAND — Nearly a year into the agreement between the City of Worland and Washakie Development Authority, the WDA is still looking for the first customer for the Grow Worland Revolving Business Loan Fund Program.

Matt Schneider, WDA board member and a revolving loan committee member, said the program has not been used but there has been interest in the program. He said a few banks have notified the WDA, since the agreement was made in September 2017, that they were working on loans with businesses, but in the end, funding was not needed from the Grow Worland program.

He added that the committee did look at one application but it did not go forward.

So far, Schneider said, “Customers have had other means for financing projects and didn’t go through this program.”

The Grow Worland Revolving Business Loan funding comes from the city’s community development block grant for economic development. The city had $350,000 in the program and had been using the funding for business loans as well as the sidewalk improvement program.

Last year Mayor Jim Gill approached the WDA asking them to partner with the city and run the business revolving loan program.

The city provided $200,000 toward the program that is managed by the WDA.

“These funds do not belong to the WDA. We’re just administering the program,” Schneider said. “One of the other things we want people to understand is that we are not in competition with the local banks, this is to help the banks.”

The local banks and lending institutions will include the Grow Worland fund as part of a finance package and send an application for the Grow Worland funds to the WDA for consideration, Schneider said.

After the agreement was reached between the WDA and City of Worland, the WDA held training for the local banks, in which all banks were represented, said Schneider, who is president of Security State Bank.

According to the program guide established by WDA and the city, the primary goal of the program “will be to create and/or retain permanent jobs within the City of Worland’s area of economic influence.”

Schneider emphasized that a business has to be located within the city of limits to be eligible for funding.

The Grow Worland funds are “a supplementary source of business financing for those who have a viable economic development project but are unable to obtain complete conventional funding. This program provides gap funding based on loan to value requirements while working with a participating lender,” according to the guide.

Schneider said the Grow Worland funding can help get a deal done, but it is not intended to be a substitute for poor credit.

Guidelines for the program include a minimum of the project’s total cost shall be in the form of cash, the funding from the Grow Worland program cannot exceed 25 percent of the project costs. Schneider said there is no set monetary limit aside from the 25 percent and the maximum amount of $200,000 available.

Funding can be used for acquiring real estate, land improvements, grading, street improvements, parking lots, utilities and landscaping; construction of new buildings; expansion of existing facilities; acquisition of machinery or equipment; or working capital.

Funds cannot be used for refinancing existing debt.

During discussion during the city council meeting in September when the agreement was approved, Mayor Jim Gill said, “What has excited me from the get-go, is that our local bankers, at least those who are involved with WDA at this point, are excited about this because this money would be kind of a bridge that could help bridge a deal for a business to get started.”

Council member Mandy Horath said at that meeting, “I think it’s just going to expand the options for people in this county and this town.”

Schneider said he is not sure why the program has not been utilized at this point. “It’s a good opportunity for a business to possibly obtain financing, if they have good credit and a good business plan that looks like it’s going to be a viable business, and they have some cash saved up to fit the program. Instead of using their entire cash, they can retain working capital, it’s a huge deal.”

He added, “Even for existing businesses, if they are looking to upgrade equipment or expand a facility, rather than them use all their cash, or deplete their working capital, they could look at a program like this. That’s the big thing we want to keep their working capital strong.”

Schneider said the WDA was excited about and “it was great to team up with the city to get those funds allocated and administer them … and have an economic impact on Worland.”