UWCHLAN — A week after Pennsylvania Gov. Tom Wolf announced a $268 million U.S. Rescue Plan to help small businesses, Chester County Economic Development Council (CCEDC) details how some of these funds will benefit small businesses in eight eastern Pennsylvania counties.
Nearly $20 million of that funding goes to the new Eastern Pennsylvania Regional Loan Fund, managed by the Economic Development Council. The Chester County Economic Development Board, called the Pennsylvania Catalyst Loan Fund, received the most funds of any certified economic development organization in the state.
Chester County Pennsylvania Economic Development Council Catalyst Loans will be underwritten and approved by the council for all business applicants in Berks, Bucks, Chester, Cumberland, Dauphin, Delaware, Lebanon and Perry counties.
The Pennsylvania Catalyst Loan Fund has fixed interest rates that are lower than prevailing bank interest rates, and loans are typically between $50,000 and $500,000.
The loan application process is expected to begin on November 1. Business owners should begin preparing the necessary documentation, including a business plan, financial projections, market research, key sales goals, and information about accountants and attorneys, according to the press release.
“What’s really exciting about this loan program is that we can help businesses and industries that we couldn’t serve before, and we can also provide direct technical assistance to help borrowers qualify for financing.” — Chris McHenry, CCEDC Vice President for Development Finance, said in a statement. “Previously, we couldn’t lend to working capital and inventory or lend to the retail sector unless they owned their building. This will be a real help to large street businesses that are usually not eligible for traditional loans.”
“We are pleased to receive these funds from the Pennsylvania Small Business Loan Initiative and are inspired by the collaboration with our colleagues in southeastern and central Pennsylvania that benefits the entire region,” said Gary Smith, CCEDC President and CEO. “This award will allow us, in partnership with five economic development partners spanning seven other counties, to make important investments in local small businesses of all kinds as they continue to grow and recover from the pandemic and its economic impact.”
Smith added that expanding access to credit for socially and economically disadvantaged populations is a priority of the Economic Development Council.
“We are pleased that this program, which offers small business loans at a fixed below-market interest rate, allows us to make these investments on an even larger scale,” he said.
According to the release, business situations that could benefit include a store looking to expand by purchasing inventory, purchasing equipment such as shelving, and hiring additional workers.
“Returns on these investments can take many months, and the Pennsylvania Catalyst Loan can help bridge that gap,” the release said.
Working capital funds can also be spent on items such as vehicle upgrades, advertising, building materials and repairs.
McHenry said the Chester County Economic Development Board is looking for business owners with a positive track record or entrepreneurs with strong business plans.
“We need documentation and research to demonstrate this, and now is the time to start,” he added.
Pennsylvania Catalyst loans require a match with a lender partner, with borrowers providing up to 20% equity. Loan term – up to five years. For questions and initial assistance, each business should contact their county’s certified economic development organization:
• Berks County: Greater Berks Development Fund — 610-376-6739
• Bucks County: Bucks County Economic Development Corp. — 215-348-9031
• Chester County: Chester County Economic Development Council — 610-458-5700
• Cumberland County: Capital Region Economic Development Corp. — 717-232-4099
• Dauphin County: Capital Region Economic Development Corp. – 717-232-4099-
• Delaware County: Delaware County Economic Development Oversight Board — 610-566-2225
• Lebanon County: Lebanon Valley Economic Development Corp. — 717-274-3180
• Perry County: Capital Region Economic Development Corp. — 717-232-4099