“Access to Capital”

Revolving Loan Fundsfor

Entrepreneurship

Rand M. Fisher

Iowa Area Development Group

Community Vitality Center PresentationEntrepreneurship AcademyOctober 20, 2004

CVC Entrepreneurship Academy

• Introduce Iowa Area Development Group• Share IADG’s “RLF Success Story”• Present RLF Borrowing Opportunities• Explore Iowa’s Vast RLF Resources

Presentation Overview

Introduce Iowa Area Development Group

• Membership

• Sponsors

• Mission

• Strategy

• Results

IOWA AREA DEVELOPMENT GROUP Community Foundation

“IADG: Powerful Partnerships...

connecting people and resources

to grow businesses and communities

in Iowa!”

The economic development organization for Iowa Rural Electric Cooperatives & associated Municipal Utilities.

Membership85 consumer owned utilities

Sponsors

Mission

Creating & Sustaining An

Economic Development Culture

Among Member Utilities

Strategy

TRAINING

RESEARCH

T AE SC SH IN SI TC AA NL C E

MARKETING

Results

• 507% increase in C&I power sales

• 388% increase in C&I revenues

• 73 industrial parks (5,385 shovel ready acres)

• 56 speculative buildings (1.5 M sq. ft.)

• 84 USDA awards ($22.8 million)

• 28 rural revolving loan funds

• 1,000 plus projects

IADG’s “RLF Success Story”

• USDA REDG Program

• USDA IRP Program

• IADG Partner Participation

• IADG RLF Landing Statistics

USDA Grant for Revolving Loan Fund

RUS Grants to RLF$300,000 Max

REC Administered RLF $360,000

REC

REC Matches 20% with own funds $60,000 Max

IADG Partner Participation

• 51 REDG Awards $14,459,144

28 Revolving Loan Funds• 6 IRP Awards $3,450,000 • $3,754,328 of IADG Partner Match• 138 REDG & IRP Loans

$158 M Investment Leverage

4,270 Job Creation/Retention

RLF Borrowing Opportunities

• Eligible Applicants• Eligible Uses of Funds• Ineligible Uses of Funds• Loan Terms• RLF Project Lending

Eligible Applicants

• New or Expanding Private Businesses• Local Governments• Non-Profit Community Organizations

Eligible Uses of Funds

• Land Purchase• Buildings• Fixed Assets• Machinery & Equipment• Infrastructure

Ineligible Uses of Funds

• Pre-development Costs• Refinancing

Loan Terms (Typical)

• Amounts: Minimum/Maximum $5,000 to $150,000• Rates: 0 to Prime - Ave 4%• Terms: Based on Collateral

Building 10 yearsReal Estate 10 yearsEquipment 5 to 7 years

• Other Funding: 20% Debt or Equity

RLF Project Lending

• Manufacturing• Service• Agricultural• Retail• Medical• Community Facility

Iowa’s Vast RLF Resources

• Iowa Rural Development Council Survey

• Results• Electronic Data Base

IRDC Survey and Results

Preliminary Findings

• 73 RLF Funds• $19 M in Capital• Access, Balance, Term & Contact

Information ultimately available at:

www.iowarural.org