A Barberton group soon will have $1 million to lend at low-interest rates to small businesses in the city, Norton and New Franklin.
The Barberton Community Development Corp. is among only two nonprofits in Ohio and 20 nationwide to be awarded $1 million through the Small Business Administration this year.
“This is really exciting,” said Scott Wagner, executive director of the economic development group. “This is the first time we will be offering loans outside the city of Barberton.”
Wagner said he sees a big need to provide financing to companies that have difficulty getting loans from traditional lenders at interest rates they can afford. He said an example is a manufacturing company that sees cyclical demand for its products.
The Barberton Community Development Corp., which serves as the city’s economic development arm, expects the loan funds to be available in mid to late September. The money comes through a 2-year-old pilot SBA program.
Businesses can use the loan money — up to $200,000 per deal — to buy property, materials, supplies or equipment, or for working capital.
Wagner said loan money cannot be used to relocate.
Participating businesses must have no more than 500 employees.
Wagner said he thought regionally when applying for the SBA program.
“We wanted to expand into other communities because what is good for New Franklin is good for Barberton. What is good for Norton is good for Barberton,” he said.
Wagner noted that Barberton companies draw workers from the adjacent cities.
Nonprofits eligible to receive the Small Business Administration funds serve areas that have seen above average unemployment for the region.
The other nonprofit in Ohio to receive funds from the SBA is in the Cincinnati area.
The pilot program has been dubbed the Intermediary Lending Program. Under the program, nonprofits receive funds — actually loans — that they in turn loan to businesses in their areas.
Area companies interested in the loan fund can contact the Barberton Community Development Corp. at 330-745-3070 or email at firstname.lastname@example.org.
Katie Byard can be reached at 330-996-3781 or email@example.com.