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Here’s the Money
A host of public and private sources are out there with money to lend. Now, where are you?
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Business New Haven
10/6/1997
By: BNH
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Connecticut's now fading bad times have left a legacy of business financing programs. Bureaucracy aside, these programs offer relatively fast-track approaches to small and mid-sized business financing (women- and minority-owned companies take special note).
The most complete source of information on a wide variety of federal and local programs is the Connecticut Economic Resource Center (CERC). Call 800-392-2122, or visit its web site. at www.cerc.com. Another local source is the new Regional Business Resource Center in New Haven under the direction of Richard W. Schwenzer, at 203-624-1493 x224. Also contact the regional economic development offices (see below).
Here are a few financing programs that are fairly active. Banks generally don't like to talk to start-ups and other higher-risk businesses, but the New Haven Community Investment Corp. (NHCIC) will. The NHCIC administers several programs, including the Technology Investment Fund, SBA Micro-loan Demonstration Program, Defense Diversification Loan Fund, and the SBA 504. Each program is targeted to the needs of different businesses and geographic areas. NHCIC programs are not typically limited to New Haven proper. Call 203-776-6172.
The SBA Micro-loan Demonstration Program is administered in Connecticut by NHCIC to provide loans ranging from $500 to $25,000 across the state. The micro-loans do require collateral but can be used for equipment, leasehold improvements or working capital.
The SBA 504 Program will provide a loan package of real estate, working capital and equipment financing. The NHCIC can make 504 loans anywhere in New Haven County. The SBA has other 504 lenders across the state as well. Check the regional development corporations listed below or call the SBA Hartford District Office at 860-240-4700. The 504 program provides financing for new construction, real estate acquisition, renovation, equipment and working capital. Businesses may enjoy lower down-payment requirements, pay below-market interest rates and receive longer term repayment terms.
The Community Economic Development Fund (CEDF) is a resource for both financial and technical assistance to small and mid-sized businesses in target communities across the state. CEDF offers loans from very small amounts up to $500,000. It will finance start-up and expanding businesses in selected (principally urban) communities. CEDF's key lending criteria are based on the project's overall impact on community development and on the business' cash-flow projections, rather than on standard collateral. Call 203-332-7600.
The Connecticut Development Authority (CDA) has a variety of business financing programs. Its Urbank fund insures small business loans at participating banks, allowing the banks to make loans they would otherwise consider too risky. The program is designed to encourage business investment in selected cities including Ansonia, Bridgeport, Derby, East Haven, Hamden, Meriden, Middletown, New Haven, New London, Seymour, Stratford, Waterbury, Watertown and West Haven. Call John Lobon at 860-258-7825, the main line at 860-258-7800, or ask your bank.
CDA will also provide mezzanine or second-stage financing for Connecticut technology, manufacturing, bio-medical and financial services businesses. It also will make direct loans or loan guarantees of up to $250,000 for clean-up of contaminated property or for certain pollution prevention and clean-up activities.
The Naugatuck Valley Fund provides manufacturers and distributors located in the Naugatuck Valley and many towns throughout the western area matching funds to a bank loan on a 2:1-basis for land, buildings and term working capital. No minimum; maximum loan is $200,000. Call CERC at 800-392-2122.
Greater New Haven's economic development corporations include the Bridgeport Economic Development Corp. (BEDCO) at 203-335-3800; the Meriden Economic Development Corp. (MEDCO) at 203-237-5573; and the New Haven Community Investment Corp. (NHCIC) at 203-776-6172.
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