Upon further review ...
Just two eligible municipalities in St. Croix County have declined to join a new regional business fund, which is gaining support throughout much of western Wisconsin.
New Richmond and Hammond have both rejected the idea so far, concerned that by joining the group they will lose control over state-funded revolving loan monies they now hold.
Hudson, Somerset and Woodville are among those communities who have jumped on board with the regional group. Seven counties, including St. Croix County, have joined in.
New Richmond is reconsidering its involvement after a meeting last week with Ann Raid, senior planner with the West Central Wisconsin Regional Planning Commission.
Raid said state officials are promoting the establishment of regional business funds because many smaller revolving loan funds are under used.
"The loan funds are just sitting there," she said.
By shifting revolving loan fund monies into the regional pool, Raid explained, "the funds are large enough that you can get more activity."
Once established, the regional fund would apparently have about $5 million in cash on hand, with an additional $11 million to $14 million in loans that will eventually be repaid and loaned out again.
The fund would also grow as additional grants are awarded by the state and federal government. (Revolving loan funds are no longer awarded to individual municipalities, so smaller municipal programs like New Richmond's will never grow, Raid said.)
An added bonus for regional loan pools is a lifting of restrictions on the potential use of the money, Raid said.
For many existing municipal revolving funds, loans can only be approved for such things as equipment purchases or working capital. Businesses are also required to show that the loan will lead to added jobs.
Under a regional pool, loan funds can be used for start-up loans for small businesses, downtown facade improvement loans and technology enterprise loans. Loan approvals are not tied to job creation with the regional fund.
"It opens the fund up to meet more local needs," Raid said.
Raid admitted that the New Richmond Revolving Loan Committee would no longer have direct control over their $500,000 municipal fund if the city joined the regional group. If city officials are uncomfortable with that fact, Raid encouraged them to stay out of the regional pool.
"This is voluntary," she said. "Nobody's going to force you to do it."
But, she said, if the city would like to see revolving loan fund monies used for an expanding list of potential projects, the regional group could help.
Once fully operational, the regional fund would be governed by a nine-member board made up of representatives from each participating county. Municipalities would still have input on loan applications, but the regional board would be responsible for considering larger loans of $150,000 or more.
Following the presentation, Council member Jim Zajkowski said he appreciated the extra information.
Zajkowski initially voted against joining the regional pool. "But I could change my mind," he said.
Robert Barbian, director of planning and economic development for New Richmond, said he's opposed to joining the regional pool.
"I'd rather have $20 in my pocket than $100 in your pocket," Barbian said, explaining his opposition.
Barbian said the city's revolving loan fund has been "very successful" and money has not been sitting in the bank.
New Richmond Area Chamber of Commerce Executive Director Russ Korpela said he's excited about the possibility of having a facade program for downtown businesses.
"I think there's a tremendous benefit to doing this," he said. "Losing local control can make you nervous, but there's so much up side to this. If you're not part of a regional pool, you're at a disadvantage."
Bill Rubin, director of the St. Croix Economic Development Corporation, said he supports the idea of a regional loan pool. It would give economic development recruiters another tool to help new and existing businesses in the area, he explained.
Jerry Brown, president of the New Richmond Area Economic Development Corporation, also backs the city's move into the regional fund.