Hermitage eases access, raises amounts for business loan fund

Oct. 4—HERMITAGE — Hermitage businesses in need of funding may find increased support from the city's Revolving Loan Fund.

The Hermitage commissioners unanimously approved a series of revisions for the program Wednesday.

Assistant City Manager Gary Gulla said the commissioners want to be in a position to help the city's small-business community, and that these revisions make the program easier to access and the process more business-friendly.

The revisions:

— Change the landscape and facade program to include "small business" and expanding the scope of the program to accommodate small-business needs.

— Expand the applicant eligibility to include "...projects consistent with the Hermitage 2030 Comprehensive Plan Core Values," a reference to the master plan for city growth.

— Reduce the $500 application fee for the business and industry program to $100.

— Increase the landscape and facade and small-business program maximum loan amount to $40,000 from $25,000.

— Double the $10,000 emergency and interim assistance program maximum loan amount to $20,000.

The city's Revolving Loan Fund includes two main programs — a business and industry loan program, and a landscaping and facade and smaller-business loan program.

The business and industry program can award loans of up to $150,000, or up to 50 percent of a project's cost. These projects could include new facilities, renovations or equipment purchases, and tend to be geared toward larger businesses, Gulla said.

The second program, as its name suggests, can be used for landscaping and facade projects, such as lighting and signage, for businesses of any size, while the smaller business loans can be used for any projects, such as interior modifications or pieces of equipment.

Landscaping and facade and smaller business loans can be up to $40,000, or up to 90 percent of a project's cost, Gulla said.

The Revolving Loan Fund's third initiative — the interim assistance program — has been used only once.

This program was created in the aftermath of a 1998 fire that devastated the former Hermitage Square Shopping Center at East State Street and South Hermitage Road, Gulla said.

Firefighters worked for 12 hours to extinguish the fire. Four businesses were damaged by flames, while the entire building sustained smoke damage, according to a Herald article published on April 7, 1998.

City officials then developed the interim assistance program to support those businesses uprooted by the fire. No businesses have used the program since.

There is about $600,000 available in the business and industry loan program, and about $140,000 available in the landscaping and facade and smaller business program, Gulla said.

However, cooperation between city officials and other local organizations can increase the amount of funds available for local businesses, commissioners Vice President William Moder said.

Moder also serves on the Shenango Valley Enterprise Zone board and chairs its loan committee. The enterprise zone can issue low-interest loans to qualified businesses.

When a local business applies for loans from multiple agencies, enterprise zone officials often cooperate with other agencies, including Hermitage's loan fund; the Northwest Commission, a nonprofit state organization that supports small businesses; and Penn-Northwest Development Corp., the county's leading economic development agency.

This cooperation encourages the agencies to adopt similar practices to make applications easier for small businesses, Moder said.

The same application form is shared with the cities of Hermitage and Sharon, the Shenango Valley Enterprise Zone, Penn-Northwest and the Northwest Commission, to further streamline the process.

"We want to make it as friendly to the applicant as we can, so we can put together the best package that serves their needs," Moder said.

The loan program's benefits often reach beyond the city's boundaries.

Previous loan recipients have included Care-Fill LTC in Hempfield Township and Castle Canning's facilities in Sharon, and the enterprise zone's coverage area was expanded to all of Mercer County last year.

Looking forward, Moder said enterprise zone officials have discussed further updates to the zone's loan program, including increases to the maximum loan limit of $250,000 or the amount of dollars-per-job-created along similar lines as the city's RLF programs.

"I think that small businesses are an important part of the local economy for the enterprise zone and Hermitage, so we're always looking to assist small businesses and make it as streamlined as possible, particularly to get more than one lending body involved," he said.

For more information on the Revolving Loan Fund, visit the city's website at www.hermitage.net or call the Hermitage Municipal Building at 724-981-0800.

Like David L. Dye on Facebook or email him at ddye@sharonherald.com.