NEW FINANCING PROGRAM FOR SMALL BUSINESSES

A new financing program for helping small businesses expand is now available in Pike County.  It is the Small Business Administration’s 504 Loan Program.  The Pike County Industrial Development Corporation (PIDCO) has established a partnership with the South Eastern Economic Development Company in Exton, PA which is a designated Certified Development Corporation for the SBA 504 Loans.

In order to qualify a business must have fewer than 500 employees, a net worth of not more than $6 million, and an annual net income after taxes not exceeding $2 million.

The loans may be only used for fixed asset financing:  plan & acquisition, construction, renovation, or expansion (including the acquisition of land).  Loan proceeds may be also used for land and site improvements, the acquisition and installation of machinery and equipment, and the interest on interim financing.  The minimum total project cost is $200,000.

According to Dave Wilson, President of PIDCO, “one of the nice things about this program for the Pike County business community is that it’s not just focused on manufacturing.  Eligible recipients include businesses such as motels/hotels, assisted living and day care facilities, gas stations/convenience stores, restaurants and franchises.  It fits Pike County where the number one industry is tourism.”

For an existing company, a maximum of 40% of the project cost can be obtained through SBA 504.  Typically, 50% of the costs come from private financial institutions and a minimum of 10% from equity.  The SBA 504 loan carries a fixed rate of interest, with a term of up to 20 years for real estate and 10 years for equipment.

For more information, contact the Pike County Industrial Development Corporation at 570-296-7332 or pres@pidco.com.