The Carroll County Board of Commissioners approved a $500,000 small business loan fund in late June to help local startups get up and running. The commissioners are scheduled to hear the details on how it will work in open session Thursday.
Several weeks ago the commissioners voted 4-1 (Robin Bartlett-Frazier voting against) to accept a $250,000 state of Maryland small business loan fund grant and to transfer $250,000 in matching county funds into the economic development budget. The county matching funds are dollars already budgeted for the Department of Economic Development; they are just being transferred into this particular fund.
Do you think this is a wise use of the county's economic development dollars?
The state grant is available from state funds in fiscal year 2012 and fiscal year 2013. Each fiscal year, the grant request is for $250,000 and requires a 100 percent match from the county.
Commissioner Doug Howard said it's difficult for small business startups and expansions to get loans and this program will fill a gap to help local startups build their financial portfolio so they can get commercial loans later.
Carroll County Economic Development Administrators, Jon Weetman and Jack Lyburn explained to commissioners that individual loans might be as much as $25,000 and a set of criteria would be established to help determine eligibility.
Bartlett-Frazier said she had concerns about how the program will function.
"Generally speaking, my gut is the government shouldn’t be in the banking business," Bartlett-Frazier said. "We shouldn’t be picking winners and losers and taking risks with the citizens' money."
Frazier also said she's concerned that the commissioners were being asked to vote on the program without specific details, including lending criteria and a collections process.
Commissioner Richard Rothschild said that he would vote in favor of transferring the money but only if the economic development staff presented suitable plans for the lending program, to include Bartlett-Frazier's concerns, in early July.
Today the commissioners will hear the details of the small business revolving loan program that will be administered by the Carroll County Economic Development Department.The open session will begin with public comment at 1:30 p.m. in the County Office Building.
"Credit is very tight," said Commissioner Haven Shoemaker. "One of the reasons we have an economic development department is to spur economic development. Small businesses are the backbone of the American economy and if we need to help them get off the ground, I’m 100 percent for it."