Revolving loan fund paying off
The beauty of a revolving loan fund is that when loans are paid back, the money is loaned out again ... paid back ... and loaned out again.
That's the theory and -- up to this point -- the plan has worked out exceedingly well in Red Willow County. The program began in 1998 when Community Development Block Grants of $540,000 were awarded as loan funds for two large-scale milking operations: Red Willow Dairy and Three Star Dairy.
The loans provided a double bonus. For starters, they gave the dairies the funds needed to build facilities and purchase equipment, thereby helping create added employment for the area. On top of that, the region's economy benefitted because the loan payments did not have to go back to the federal government. The funds could stay here at home for reinvestment.
And -- six years later -- that's exactly what is happening. Red Willow and Three Star have made their payments on schedule, giving the county's revolving loan committee a flow of funds to loan to other ventures.
The success of the revolving loan program was illustrated this week when Red Willow Treasurer Marleen Garcia announced that one of the loan recipients, Doak Construction, Inc. had paid off its $70,000 loan 22 months early. Doak had used the loan to purchase a crane, which generated sufficient additional business to allow the early payoff.
That's good news for Doak Construction. It's also good news for the area economy because more funds are available, earlier than scheduled, for reinvestment.
The dairies are also on schedule, with 10 months remaining on Red Willow Dairy's $320,000 loan schedule, and 12 months left for Three Star Dairy to pay off the remainder of its $220,000 loan.
Loan money is also at work for improvements at Silverstone, the tire supplier for Valmont, and Rod and Pam Gaston, who operate Gaston Lawns & Landscapes and Pet Pros. The loan amounts are $70,000 for the Gastons and $55,000 for Silverstone.
Another enterprise which received a loan assist, Jonzeez Java, is no longer in business. The venture received a $15,000 loan for the building, and -- to date -- those funds have not been repaid.
Yes, there are risks. All ventures do not succeed. But we've been fortunate in Red Willow County that the dairies have succeeded; and, by so doing, launched an on-going loan program for the benefit of local and area businesses today ... and in the years to come.