WASHINGTON, D.C. – Businesses in Southwest Colorado will be eligible for $300,000 in federal grants, Sen. Cory Gardner, R-Colorado, said in a release.
“I look forward to the growth of small business and better jobs as this money is put to use in our local communities,” Gardner said.
The Region 9 Economic Development District of Southwest Colorado will use the money to provide revolving loan funds for the counties of Archuleta, Dolores, Montezuma, La Plata and San Juan. Revolving loan funds are managed by local non-profits, and are intended to create small loans for start-up and small businesses that cannot get a traditional loan.
The grant will be matched by Region 9, resulting in a total of $600,000 for new rural businesses.
Laura Lewis Marchino, executive director of Region 9, said it has $5.3 million on loan in the five counties, with the average loan size of $25,000 to $50,000.
The nonprofit gave Mercury Payment Systems, now Vantiv Inc., and Zuke’s Ascent Natural Dog Food their first loans.
The federal loan from the Economic Development Administration is part of a bigger project to meet the region’s demand for startup and agriculture businesses. According to the EDA, economic development nonprofits such as Region 9 have helped small businesses throughout the country.
“The funds will be used to bolster small businesses in the region and support our rural communities that have trouble accessing capital,” Gardner said in a statement.
Marchino said Region 9 applied for the federal grant before the new administration took office, because they knew cuts were coming.
“If the cuts go into place, we are definitely going to see a decrease in funds,” Marchino said.
Region 9’s percentage of failed loans is six percent, while a bank normally has a failed loan rate of two or three percent.
“We are doing good considering that we know these loans are high risk,” Marchino said.
She also said the nonprofit will work with businesses to create a repayment system for them and even extend timelines if necessary.
“We don’t want their house. We will work with them,” Marchino said. “Because we are a not a bank, we can be a little bit more flexible.”
Josephine Peterson is a reporting intern for the Herald in Washington, D.C., and a recent graduate of American University. Reach her at jpeterson@durangoherald.com and follow her on Twitter @jopeterson93.
