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Show rgnTil r y TT The lJp"Tr,Tyybti'yTl ayTrrtMit,filhjaf Mnjnmii,imriMtfl lia"Ty Thursday, March 2, Tlmes-lndepende- pp r ww mirnBaintfiffh 1989-A- 5 Southeast Utah First In A Continuing Series Small Businesses Create Most Jobs In a 1987 report, theNational Commission on Jobs and Small Business emphasized that small firms are major employers in manufacturing, communications, finance and real estate. Together these sectors have economic impact. The Commission noted that firms with fewer that 100 employees account for 38 percent of all private employment in cities, and 56 percent of all nonfarm employment in small towns and rural areas. Small firms account for more than one-thir- d of the gross national product They are also the seeding grounds for economic change; half of the major industrial innovations in the past 30 years started in small Governors Mandate; zations and chambers of commerce have hostednumerousconferenccs and seminars for businesses and new busi- Help Business Grow Business expansion and retention is part of Gov. Norm Bangertcrs mandated economic development program . 1 1 s a priority with local officials, too. Stronger efforts arc being made to inform business throughout Utah where assistance is available and how to get it. Small business conferences were hosted by the state and regions in 1988 to help determine what government services help existing business expand, and what services induce budding entrepreneurs to enter the business world. Local colleges and universities, associations of governments, economic developmcntorgani- - ness startups. More Business. More Jobs Nurturing new firms to help assure their survival has become a new economic development goal. Technical assistance programs now increase the survival odds for small businesses byconfronting the most common probable causes of failure poor management, accounting practices and weak marketing... Meeting development needs of a maturing company brings payoffs for local investment in terms of jobs and tax revenues. Local Revolving Loan Funds Can Help Fill Financial Gap Some communities in the southeastern Utah area operate small business revolving loan funds. Typically, these loan sources were established to aid the small business who has been unsuccessful getting financial assistance from the regular service banks or other lending institutions. Most have been capitalized through Community Development Block Grants (CDBSs) awarded to the communities by the state from its federal Housing and Urban Development program. The low interest loans have averaged $10,000 to $30,000 and have filled the gap for expansion efforts of rural businesses. Currently only San Juan and Emery County have esCounty tablished loan programs, but efforts are being made by regional and local government agencies to secure grant money to start more assistance in the four counties. RLF Creates 27 Jobs In Emery County Emery Countys revolving loan fund was capitalized with $50,000 from a community development block grant, according to the Emery County Economic Development Councils director, Scott Truman. Weve leveraged $500,000 in investment to the communities in Emery County and created 27 new jobs, Truman noted. 'Loans to expanding businesses have ranged from $3,000 to $30,000. The Emery County fund is limited to businesses already established in the area or new business locating there. The council is not a primary lender; they take a second or third position with another lending institution. The interest rate is flexible, as is the term of the loan. SBA lending criteria for job creation and retention is used $15,000 loaned for each new job. Eligible businesses are reand manufacturing. The tourism tail, low to moderate benefit should jobs income families of Emery County. Interested businesses should contact the Emery County Economic Development Council at the address below. Scott Truman, Director Revolving Loan Fund P.O. Box 297 Castle Dale, Utah 84513 (801) 381-557- 6 Businesses in San Juan County also have access to a new small business loan fund. The San Juan County Commission created the San Juan County Revolving Loan Its director, Rick Bailey, said new job created or retained. any business that can demonstrate the loan would create new jobs for low to moderate income residents; of the county or would retain jobs that might otherwise be lost, will be eligible to (801) Contact: Rick Bailey, Director San Juan County Revolving Loan Fund 587-223- 1 Peggy Humphries San Juan County Economic Development (801) 587-223- 1 Hatching Southeast Utah's Entrepreneurs Before a good idea can become reality and make money, money is usually required. Most new businesses find financing harder to come by than the great idea. But there is money to help entrepreneurs. Identifying funding sources and spelling out how to tap into them is the purpose of this special financial resource directory. Generally, banks come to mind first in con templation of primary sources of financial help for small companies. Whether a bank is an appropriate source depends on the stage of development of the particular company. Nevertheless, it is good sense for a business person to develop familiarity with a banker, whether the needs are personal or business. Estabrelationship with a lishing a long-terbanker who can offer advice is impor m tant before the need for money arises. When opening a checking account, seek out th bank manager and introduce yourself. Describe your company and its purpose, progress and plans. Usually, funds are not readaccessible from banks unless the ily new venture has a proven track record and collateral to secure financing. Banks are obligated, through regulations protecting depositors, to take only reasonable risks in making loans. They look for at least a moderate return. When banks do lend money, they are in effect a paruier with the borrower, and the bank wants to be sure of the borrowers success. Every new business is as individual and unique as the entrepreneur himself, and the banker or any.; will understand your comlender be in a better position to and pany assist if some preparation for funding is done before approaching a bank. Preparation For Funding; Before seeking venture capital, grants, or commercial and federal loans, prepare: a three- - to five-ye- ar business plan, The question from a financier that is most likely to follow the fjist hello ,is'What is ypuj- - plan? Getting help with the plan from a professional, a banker, or a community technical organization will be well the worth time, j a current financial statement and documentation of financials from the past tljree years. An accurate statement not only is necessary to secure initial financing; it becomes an important resource in planning for the future. identify within the business plan the amount of money needed and the anticipated source- - (equity1 andor loans)- - A lender expects the borrower to beknowledgeable about ahd be able State CDBG Interim Loans Available To Manufacturers new and viru-tall- y Interim Loan Float For more information, conunused interim finance program is available to expanding businesses tact: , ; through the Comm unity Development t Eastern Utah Inc. Block Grant program. HaroldlR. MarstonV Coordinator The CDBGInterim Loan V, ' Float is reserved for businesses who (801) meet guidelines of the federal HousSoutheast Utah Association ing and Urban Development (HUD) for creation of jobs for low to moderOf Local Governments I Dixie Barksdale ate income families and operates as a draw-dow- n .Economic businesses All account Development Specialist ' ' must have a major financial institu-tio- n .. (801) 259-228-5 " 4 letter of credit to be eligible for (801) ! this form of short term financing. Utah Department The project has only teen Of Community & used twice; Checmical Process Sys- Economic Development terns (CPS) which located in WellingA to communicate clearly and concisely the specific funding needs of an enterprise. They need to be listed and categorized as research, inventories, personnel, capital expenditures, etc. a logical and practical repayment plan for all sources. Ideas dont come easily, and neither does financing. Arientrepreneur may have to solicit funds from many places, and may be turned down again and again. But when a financier finds a product or service exciting and sees evidence that appropriate planning steps are being followed, patience and persistence on the part of the new businessman additionally improves prospects of financing. Working With The Small Business Administration Federal Loan Programs 637-470C- H 1 637-544- ton 'A this year used the Short. Term. S' , w (801) 538-30- . 33 , Future Issues: VentureSeed Capital Business Incubation Getting Government Contracts ' I V |