Last week, the Southwest Missouri Council of Governments (SMCOG) received an award from the U.S. Department of Commerce’s Economic Development Administration (EDA) to capitalize and administer a $1 million Revolving Loan Fund (RLF) program to help Southwest Missouri businesses and communities recover from the coronavirus pandemic. The fund will provide gap financing to leverage private funds for business expansions, entrepreneurs and start-ups, or public investments that create or retain jobs.
The program is funded with a $975,000 grant from EDA matched with local funds. SMCOG is the federally designated Economic Development District for a ten-county region surrounding the Springfield metro area and is partnering with the Harry S Truman Coordinating Council (HSTCC) in Joplin, Missouri which will allow the program to serve entities within fourteen counties in Southwest Missouri.
“This loan fund will help finance projects which may be deemed too risky for conventional financing,” said Jason Ray, Executive Director of SMCOG. “We will not compete with private lenders, but rather partner with them to take a chance with our local entrepreneurs and small businesses to help them recover from the impacts of the pandemic and create or retain jobs for the region.”
Loans will be available to entities adversely affected by the coronavirus pandemic in Barry, Barton, Christian, Dade, Dallas, Greene, Jasper, Lawrence, McDonald, Newton, Polk, Stone, Taney, and Webster counties.
Loans may range from $20,000 to $100,000 with interest rates as low as 4% or 75% of prime for a term of three to fifteen years. Eligible projects will include business acquisitions or relocation; construction; purchase of land or facilities; purchase of equipment or machinery; start-up operating costs and working capital; pollution control and abatement; hotels, motels, convention centers, or other tourist and recreation facilities; and educational institutions.
SMCOG wishes to partner with area banks to finance projects through the fund. Additionally, SMCOG is seeking individuals with commercial lending experience to serve on the Loan Review Committee which will help set interest rates and other loan terms.
Similar EDA-funded loans are currently available in other parts of the state through Economic Development Districts, but this represents the first time the program will be available to businesses in Southwest Missouri. The organization hopes to begin making loans within the next several weeks.
About the Southwest Missouri Council of Governments
The Southwest Missouri Council of Governments is an association of local governments, Regional Planning Commission, and federal Economic Development District for a ten-county region in Southwest Missouri. SMCOG’s mission is to improve the quality of our communities through regional cooperation.