By Deb Hadachek Telescope News
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Local businesses struggling due to COVID-19 may qualify for an economic shot in the bank account to keep employees working thanks to the Republic County Revolving Loan Fund.
The Kansas Department of Commerce has released some $411,000 of RCD funds to provide no-interest loans so local businesses can continue to pay staff. Loan amount is limited to $20,000 at this time.
No payments will be due for four months; the balance is to be paid within 36 months.
“We are determined to keep this simple,” said RCD board member Mikel Hadachek of the application process.
Businesses who apply will be asked to show how they are going to use the loan to preserve jobs, said Kay Shoemaker, RCD secretary. A business must have at least one full time equivalent low/moderate income employee. Owners do not count as employees.
Businesses must submit a letter that they are either shut down or will be shut down due to COVID-19.
No collateral or matching funds are required. Loans will be made on a first come, first serve basis. Loan applications are available at any Republic County bank or on the Republic County Economic Development website www.republiccountykansas.com/covid-19-CDBG/.
Hadachek said the RCD was notified late last week that the money would be released to use as counties needed. He complimented Shoemaker for her work through the weekend to make sure a proposal was ready to be approved by Republic County Commissioners Monday morning.
The KDOC funds have been a bugaboo for the RCD committee the past several years. Burdensome state requirements meant that it was difficult for businesses to qualify for loans from that fund. The RCD also has a loan pool available from E-Communities, a partner of NetWork Kansas, that are often easier for businesses to access.
“We’ve always worried that the state might ask for these funds to be returned if they’re not used,” said Hadachek. “Now we’re blessed that we have that money. If we can help 20 businesses in the county, won’t that be awesome?”
“And we get to keep the money in the community,” said Commissioner Ed Splichal.
Shoemaker said that Republic County is one of 37 counties that had KDOC revolving loan funds that were ordered by the state to find creative ways to release those funds to local businesses. Like the regular RCD loans, as money is repaid it will return to the revolving fund to be loaned to other businesses.
Republic County Development’s Revolving Loan program was created in August 1985 when Kansas Department of Commerce & Housing and the Federal Housing and Urban Development made grants to the county and allowed the County Commissioners to “revolve” funds recaptured from economic development loans made to three large Republic County businesses. The $663,750 seed money repaid through these three loans has created business development opportunities across the Republic County, with nearly $3.5 million loaned to 108 businesses. Over 260 jobs have been created through this process. RCD funds now assist 14 active business entities in Republic County today.
“We expect these 20 loans to be snapped up quickly,” Shoemaker said.