BLOOMINGTON — McLean County will make some small but important changes as they revive a long-dormant business loan program.
McLean County Board members hope to reduce the number of employees required; ratio of jobs created to dollars loaned; and term for loans made to small businesses looking for additional funding to get started.
The tweaks would update a similar state-mandated program that was discontinued because it was rarely used. County officials have spent months deciding how to spend a one-time $1 million balance from the end of the program.
"We want to fill in the gap for somebody who got a loan from a commercial institution and needs a little more to get started," board Chairman John McIntyre said last week.
Businesses with 10 or more local employees could apply for as much as $250,000 — 40 percent of a project's cost — to be repaid up to 15 years at or below market rates, as long as the business creates one job per every $35,000 lent and uses specific locations in the county.
Those requirements are less stringent than the previous 50 employees and $15,000 per job. Terms would drop from a maximum of 20 years in order to let the county loan the money more frequently.
Board member David Selzer said it may be useful to start the program, keeping in mind the county retains the ability to change it later.
"We will gain feedback just as we gained feedback that there wasn't interest in the (state) program," said county Administrator Bill Wasson.
The Bloomington-Normal Economic Development Council would administer the loans, which would need to clear several layers of county approval.
Board members also discussed with Wasson a similar program on a smaller scale intended to help rural communities that will combine two previous ideas.
Under one proposal, small businesses that can't get loans would apply for as much as $50,000 to be repaid over no more than six years at 7.75 percent to 9.75 percent interest, depending on the applicant.
Under another, rural groups would be able to apply for $10,000 to be repaid over seven years at low interest — 0 percent to 3 percent — "to promote themselves by aiding in the procurement of signage, (brochures), park equipment, other equipment and other products and services to bring in more retail, manufacturing and education opportunities."
Municipalities, civic and fraternal organizations, school groups and other not-for-profit groups would be eligible. For-profit groups would not.
"Staff is a little concerned about nonprofits because many times nonprofits won't have anything of substance we could use as collateral for a loan," said Wasson, noting villages could "raise their taxes if needed to pay us back."
Selzer suggested both programs require verification that potential recipients have already sought other funding, including state or federal money.