By By JOHN EBY / Dowagiac Daily News
CASSOPOLIS - A $750,000 loan program designed to support business development and job creation across southern Michigan was unveiled Monday by Midwest Energy Cooperative and the state director of the U.S. Department of Agriculture (USDA) Rural Development program.
Midwest, a member-owned electric utility based in Cassopolis, will administer the seven-county fund.
Midwest was named an intermediary partner in Rural Development's Intermediary Relending Program.
The $600,000 loan fund closed March 21 as Dale Sherwin, Rural Development state director for almost two years, presented the check to Robert Hance, Midwest Energy Cooperative president and CEO.
The cooperative contributed another $150,000 to the fund, making a total of $750,000 available.
Aim of the revolving loan fund is to finance business facilities and community development projects in rural areas.
Loans must be used to establish new businesses, expand existing businesses, create employment opportunities, save jobs or complete community development projects.
According to the USDA, the Bush administration has invested more than $149 million to support local revolving loan funds since 2001.
USDA further reports that $39.7 million was awarded through 63 revolving loan funds in 2004, supporting 223 businesses and creating or saving more than 30,000 jobs.
Like Housing and Urban Development assists cities, Rural Development furnished $20 million last year in Michigan for rental assistance "to help people get to the point where they can qualify to secure a loan for a home."
Elderly people 62 or older can be granted up to $7,500 to help them stay in their own homes instead of being prematurely dispatched to a nursing home.
The local program will provide loans to benefit rural economic development in Cass, Berrien, St. Joseph, Van Buren, Kalamazoo, Lenawee and Monroe counties.
Loans will be available for both start-up businesses (30 percent of total project, not to exceed $150,000) and ongoing businesses (40 percent of total project, not to exceed $150,000).
Midwest expects one job to be created for every $10,000 borrowed.
Interest will be half of the prime interest rate at the time of approval by the Midwest Energy Cooperative board of directors. Most loans will match the term of the bank portion of the financing.
Midwest almost overlooks 53 acres Cassopolis set aside for an industrial park, but "there are no active lookers at that property," Hance said. "Some of this money could be used to help offset costs to extend water and sewer and make the property more attractive to a potential manufacturer. That's pretty expensive to do in a community that's strapped. As the director said, this is not just about jobs, but also quality of life issues. You have to do them in concert."
Carl Milliron will administer the loan program for Midwest. Anyone interested in more information is encouraged to contact him at 269/445-1021.
Midwest provides electric and an assortment of energy-related programs and services to more than 32,000 members in 11 counties in southern Michigan and northern Indiana and Ohio.
Midwest Energy is the parent company of Midwest Connections and Midwest Propane, with district offices in Cassopolis, Paw Paw and Adrian.