Getting to Nitty Gritty of Carroll County Small Business Loan Plan

Carroll County commissioners will hear the details of the small business revolving loan program in open session today.

The 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."


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David J Iacono July 12, 2012 at 12:40 PM
If these small businesses go belly-up, who gets stuck with the defaulted loans? I would guess the taxpayer especially if no collateral is required. If banks won't loan these small businesses any money, aren't the banks saying these aren't a good investment to begin with? I don't think it's a wise investment by the county especially when budgets are so tight to begin with.
dugAhole July 12, 2012 at 02:48 PM
Free money, sign me up. Sounds greasy and full of potential cronyism. Who authorizes these loans, who is going to monitor them and who's payroll are they on? What are the rules on who is eligible to get these loans? if those same individuals requesting the load cannot get a lender to lend to them how is this a safe bet for the County. Sounds like throwing money out the door. Oh, I forgot, we have plenty of money, the fighting 59th just gave us a tax break because the coffers are full. We have plenty of reserves for repair roads and pay for Rothschild’s legal fund. What’s another $250,000 plus administrative expenses going to do to us that’s not being done already. Watch where the money flows…..
Buck Harmon July 12, 2012 at 03:14 PM
I wonder if someone were to start a government accountability investigation buisness... it would qualify for such a lone....?
Buck Harmon July 12, 2012 at 03:24 PM
Shoemaker clearly understands the process of giving away taxpayer property and money....Ask him how much money the town received for old Hampstead School... gave it away, valued at 1.8 million to the private corporation that currently profits from it. I have to wonder if he and Mayor Nevin, (the banker) aren't shareholders...??
Buck Harmon July 12, 2012 at 03:27 PM
Most of the Hampstead taxpayers never even realized that the town owned the property before it was given away.
Buck Harmon July 12, 2012 at 03:31 PM
Question for Patch... What ever happened with Shoemakers use of eminent domain land grab at the Oakmont Golf Course?? Haven't heard an update for quite a while., Was something settled behind closed doors??
Buck Harmon July 12, 2012 at 03:33 PM
Nitty Gritty comments...I know..
Bonnie Grady July 12, 2012 at 04:20 PM
If the county is so flush with cash, how about a real raise for county employees?
SOUTHWESTMINSTER July 12, 2012 at 04:20 PM
Nobody else will say it, but Frazier is correct on this one.
Bonnie Grady July 12, 2012 at 04:21 PM
What happens to our prized AAA bond rating when these businesses go belly up and the county is left holding the bag?
Bonnie Grady July 12, 2012 at 04:37 PM
There used to be a group of bankers who came together as the Carroll County Development Corporation (CCDC). Is it still around? I served on the board for several years and worked like this. Each of the banks kicked a certain amount of cash into a loan fund which the county oversaw. Administrative services for the group were also provided by the county. The group met once a month and reviewed small business loan applications. If the group agreed the loan should be granted, one of the banks stepped up to do so, but the loan was backed by the larger fund. It was a win-win. The business owner got a loan that likely would not have been approved by a single bank, the bank got the benefit of interest on the loan, the county looked good for supporting small business, and everyone was protected by the shared risk. So why is this Board reinventing the wheel and placing 100-percent of the risk on the taxpayers? If they think it's such a great idea, let them put up their own money! And I have to wonder just how much Howard's small business consulting firm is going to benefit by this. He absolutely should recuse himself in this debate due to clear-cut conflict of interest issues.
SOUTHWESTMINSTER July 12, 2012 at 05:11 PM
And it begins
John Culleton July 12, 2012 at 05:46 PM
I said so in last Sunday's Eagle. John Culleton
dugAhole July 12, 2012 at 08:09 PM
Just wonder "What begins?"... Is this not something that should be discussed? This should be a bipartisan issue. I for one want this county to stay in the black and I'm a liberal. Helping those who need help is a liberal cause; but, if this is to succeed only those "qualified" should be given these loans. I don't trust the county (commishes) to make that decision in an unbiased way. There is too much partianship in this county.
Bonnie Grady July 12, 2012 at 08:21 PM
Vote passed 3-2. The county is now in the loan shark business.
Kym Byrnes (Editor) July 12, 2012 at 08:21 PM
I don't know off the top of my head but I can look into it.
Kym Byrnes (Editor) July 12, 2012 at 08:22 PM
Did anyone watch or go to the commissioner meeting today where this was discussed? I will post a story tomorrow with the details of the meeting, but in the meantime wonder if anyone has thoughts on today's meeting.
Buck Harmon July 12, 2012 at 09:13 PM
Thank You Kym...
Buck Harmon July 12, 2012 at 09:15 PM
I'm looking for a small business start up loan... can't wait to fill out the paperwork...
watchingfive July 12, 2012 at 09:36 PM
I keep wondering how Doug Howard will personally benefit from this initiative. He runs a small-business start-up company. The more the county does for small businesses that are getting started, the more Doug Howard profits from his own business that offers services to those start-ups. Not sure why this isn't getting some scrutiny in the local press - smells a little fishy to me. Maybe Howard should recuse himself from county dealings that benefit the small business community that provide him income.
L Collette July 13, 2012 at 02:54 AM
watchingfive you make a good point. I too would be interested in getting a response to your question(s). Could the Patch follow up on this?
Buck Harmon July 13, 2012 at 11:13 AM
They never thought about it before the vote.....that would fall somewhere between ring 2 and ring 3 of the BOC circus...
Kym Byrnes (Editor) July 13, 2012 at 05:59 PM
A Patch blogger weighs in on the topic: http://patch.com/B-cd2H
SOUTHWESTMINSTER July 13, 2012 at 06:58 PM
I don't trust the county (commishes) to make that decision in an unbiased way. There is too much partianship in this county Your words ......................
John D. Witiak July 13, 2012 at 09:34 PM
Look, I find a lot of the actions the BOC takes are problematic, BUT... let's take a breath here. For AG Preservation under Mr. Robertson, I congratulate him and the BOC, as did the state. I like attempts to be creative as long as the creativity doesn't turn into a scam. There is some risk, of course, of failure but just because Howard consults to help small business doesn't mean that he is setting up a framework to carry out some shady deals. Actually, we may learn from his business expertise. And, hey, the Bretheren Service Center helps micro startups all over the world and all kinds of good comes from that. Besides, growing businesses is healthier tax wise than a housing development dumped onto ag land. Continued vigilance is the real key here. Let the ball be with the BOC. If their boldness pays dividends for our Carroll County, I will congratulate them. If there is some failure, I will congratulate them for their creative attempt. But watch out if there is anything crooked. This Democrat will then demand swift justice from the States Attorney.
JoeEldersburg July 16, 2012 at 05:30 PM
I didn't hear the BOC would have any say in who gets the loans, nor do I believe that the currently rigged banking system is fair to those in need. This seems like a responsible use of money to fulfill economic development goals. I just wish the lenders could realize that if an owner is an "S" corp, it really doesnt matter where the business is located, as long as the owner is a Carroll resident. Carroll is not a top business destination,on, but with more investment in higher performing schools and a better infrastructure, we could be more attractive to wealthier families, which lowers the tax burden by virtue of higher property values. Simple economics.


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