Low-interest revolving loan pool available to Union City businesses | News

Union City-area businesses have an option, in addition to bank financing, to help them compete in the marketplace.

The Corry Redevelopment Authority (RDA) has a revolving loan fund targeted specifically to businesses in Union City Borough and Union Township, totaling some $839,000, which can provide loans at interest rates lower than banks can offer.

Bob Williams, who took over as RDA executive director about a year ago, said the loan pool has existed for several years but that some local businesses may not be aware of it. Loans from the fund have been made – the construction of the new American Legion post on Route 6 east of the borough some 10 years ago being an example – but Williams would like to see the fund help spur more economic activity.

New equipment, expansion or property acquisition are among the activities that could be funded through the fund, he noted, adding that the RDA can work alongside banks to provide financing or may be able to fund an initiative entirely on its own.

As the loans are paid back, they go back into the pool to fund other future Union City-area initiatives.

“It’s a revolving loan fund just for the Union City area,” Williams said.

Projects don’t have to be large, as the RDA also offers “micro loans” for under $25,000, with a $50 application fee and simpler application process. Williams said the RDA’s interest rates are typically 1% below the “prime” rate, which is a rate that banks typically provide to their most credit-worthy customers.

The RDA’s current rates are 4.75% for equipment up to a seven-year payback, and 5.25% for mortgages up to a 15-year payback.

Williams said the RDA, through a separate Corry loan fund, recently assisted an employee in buying the vehicle-repair shop he worked at in Corry from its previous owner. Williams added it is not always easy for businesses or entrepreneurs at a smaller level to obtain bank loans, and that the RDA can “fill in the gaps” in business financing.

It’s still a process, however, that typically involves providing financial documents, a personal visit from Williams, a review and recommendation by the RDA’s loan committee, and approval by the RDA’s board of directors.

Understanding that businesses often need to move quickly once they’ve made a decision about buying equipment, expanding or relocating, Williams said the RDA’s goal is to match that urgency.

“As soon as I have an application, it’s usually 60 days to get through a deal,” he said, adding it could be a little sooner or longer depending on the complexity of the project.

“Nobody’s taking chances with these businesses,” he said of the difficulty businesses, particularly smaller businesses, can have obtaining financing. “We’re trying to streamline to make it quick. We’re going to do whatever it takes.”

Whether the project leads to job retention and creation are questions on the RDA’s application, but Williams said he is typically more interested in simply helping businesses stay healthy.

“The jobs will create themselves,” he said, adding that he looks at job retention “just as equally” as job creation.

The RDA can be reached at 664-3884.