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Business and Industry Guaranteed Loan
Success Stories
Arizona | Colorado | Florida | Georgia | Idaho | Iowa | Louisiana | Minnesota | Missouri | Montana | New Hampshire | North Carolina | North Dakota | Oklahoma | Pennsylvania | South Dakota | Tennessee
For detail information about the program visit the Business and Industry Guaranteed Loan webpage.
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Arizona:
Outline of Need:
Ten years of drought in the west have made the forested north portion of Arizona very susceptible to wild fires. Devastating fires have hit the area particularly hard over the past two years. One of the challenges has been adequate aerial fire fighting equipment in the area.
How Rural Development Helped:
Aero Flite, Inc., based in Kingman, Arizona, provides the vital link for the region in combating this natural disaster. Aero Flite received a loan in 2004 that they used to purchase a hangar and office building and some older CL-215s and DC-4s. This subsequent loan of
$2 ½ million will allow the company to purchase two additional CL-215 Bombardier Air tankers to fight fires. The CL-215s are designed specifically for fighting forest fires, with the capability of swooping down and scooping up water from area lakes or dropping chemical retardant if no water supply is available. Aero Flite is the leader in aircraft firefighting and the only non-governmental owner of CL-215s in the United States. The company is performing well on its previous loan from 2004.
The Results:
This partnership not only provides protection for the rural communities in northwest Arizona, but is also expected to save 26 jobs. The wages average $40,000 to $60,000 per year for the mechanics and as much as $70,000 for pilots (considerably more than the average for the area) helping to improve the economic well-being of the community.
Although the company is based in the west, they can and will travel to any location in the nation where their services are needed. Most of their revenue is generated through government contracts.
Colorado
Florida:
Georgia
Outline of Need:
Fresh Beginnings, Inc. needs to expand the facility to 77,000 sq. ft. This was needed to take advantage of increasing volume of business. The Advertising Specialty Division, for example, has seen its sales double every year, but the lack of facilities in the existing building hindered the storing, packing and shipping of specialty gifts.
How Rural Development Helped:
Rural Development provided a Business and Industry Guaranteed Loan for $3.6 million in the winter of 2000.
The Result:
Fresh Beginnings employs 350 people and specializes in providing customer retention services to corporate clients with large volume and big-ticket products. The company’s trade market is fresh-baked tins of chocolates, sugary confections and cookies. As a result of the Rural Development Loan, the Call Center was expanding from 16 to 48 workstations. The expansion resulted in 45 new jobs.
Idaho:
Outline of Need:
Unicep Packaging, Inc. is located in City of Sandpoint. The City, which is located on Lake Pend Oreille in North Idaho, has a population of 6,835 according to the 2000 census. The area has been affected by the decline in the logging industry and has an increasing reliance on the tourism industry for its economic base in addition to light manufacturing.
Dr. John Snedden, a second generation Sandpoint resident and graduate of Sandpoint High School started his business in 1990 in a Sandpoint business incubator that has received Rural Business Enterprise (RBEG) assistance. In 1995, with the help of a USDA Rural Economic Development Loan made through Northern Lights, Inc., the electric cooperative in the Sandpoint area, the company constructed its initial 9,500 sq. ft. manufacturing plant, becoming the first company to “graduate” from the incubator. The business’ original focus was manufacturing professional tooth whitening products. Since then it has shifted to unit-dose packaging and expanded its product lines and manufacturing capacity to include custom packaging and contract manufacturing for medical, dental, pharmaceutical, cosmetic, nutraceutical, and industrial customers.
How Rural Development Helped:
The RBS-guaranteed projects financed a major expansion completed in 2003, with the manufacturing facility now encompassing 64,000 square feet. Dr. Snedden and his wife own the land and building and lease the property to their business, Unicep Packaging, Inc. Originally projected to create 62 additional Full Time Equivalent (FTE) jobs, the company reports that the expansion has, to-date, resulted in the creation of 68 FTE’s. Unicep Packaging, Inc. was awarded $2,150,000 and Dr. John and Mary Jo Snedden were awarded $2,410,000.
The Results:
The applicant reports that the average projected wage to be received by new employees is $14 per hour plus benefits, which is 271% of the federal minimum wage. Additinally, premiums for the health, dental, life, and disability benefits are paid by Unicep Packaging, Inc. Employees may also participate in a 401(k) with Unicep Packaging, Inc., matching up to 2% of the wage plus a discretionary 2% contribution at the end of the year. As a result of this program, 68 new jobs were created and 58 jobs saved.
On November 10, 2004, Unicep Packaging, Inc., received the Business of the Year award from the Bonner County Economic Development Corporation (BCEDC). As stated by BCEDC Executive Director Mark Williams as he presented Dr. Snedden with a plaque at the award ceremony: “Over the past three years, manufacturing jobs in our county have increaqsed by 21 percent while Idaho has lost 14 percent and the nation 16 percent. This is particularly signinficant since these jobs pay 38 percent higher than other industries. We feel it is time to recongnize the impact of these employers, and Unicep packaging has been a shining example of job creation in the manufacturing sector.”
Iowa:
Outline of Need:
Borrower: Art’s Way Manufacturing Co., Inc.
Lender: West Des Moines State Bank
Guaranteed Loan Amount: $2,000,000
Project: Restructure and Refinance Debt and Working Capital
Location: Armstrong, Iowa
How Rural Development Helped:
Rural Development funds will be used to refinance/restructure existing debt, acquire equipment and working capital.
The Results:
As a result of this project, 82 jobs were saved and one business assisted.
Louisiana:
Outline of Need:
USDA Rural Development issued a Loan Note Guarantee in the amount of $1,681,680 to Bank One, N.A. in Lafayette, LA.
How Rural Development Helped:
The guaranteed financing was used to construct an 18,000 square-foot supermarket, (Sunset Community Store, Inc.) to purchase machinery and equipment as well as additional inventory. Shoppers throughout the South St. Landry Parish now enjoy improved services, insuring immediate success of this USDA Rural Development investment.
The Results:
The project is located in the Lower Mississippi Delta Special Emphasis area and will create 20 new jobs and save 45.
Louisiana:
Outline of Need:
USDA Rural Development issued a Loan Note Guarantee in the amount of $8,000,000 to Bank One, N.A. in Lafayette, LA.
How Rural Development Helped:
Dynamic Industries, Inc. utilized the guaranteed loan funds to purchase two new Manitowoc Cranes, provide permanent working capital to support a recent asset purchase of an existing business, and to consolidate existing real estate and equipment loans.
Dynamic Industries, Inc. is principally engaged in fabricating offshore production platforms and providing maintenance services for oil and gas exploration and production companies. Dynamic also provides a number of other services to the oil and gas industry, including pipeline fabrication, plant maintenance, plant repairs and upgrades, used jacket storage and refurbishment, and a variety of plant management services.
The Results:
The project is located in the Lower Mississippi Delta Special Emphasis area and will save 1,500 jobs.
Louisiana:
Outline of Need:
USDA Rural Development issued a Loan Note Guarantee in the amount of $4,800,000 was used to purchase an existing lumber company located in Winnfield, Louisiana. This lumber company produces pattern and trimmed lumber. Forestry is the leading industry in Winn Parish, with over 526,000 acres of timberland covering 92 percent of the parish. Support industries, such as lumber companies, are very important to the local economy.
How Rural Development Helped:
As a result of this Rural Development loan, this lumber company will provide employment opportunities and a customer base for individuals and commercial timber producers.
The Results:
The project is located in the Lower Mississippi Delta Special Emphasis area and will save 155 jobs.
Minnesota:
Outline of Need:
Perham, MN, population 2,688 is a thriving rural community in part because of three USDA Rural Development programs. Charles Cavanagh, president of United Community Bank says Rural Development’s Business and Industry loan program has enabled his bank to partner with a dozen other community banks to leverage millions of dollars to finance major expansions at the city’s largest employer, KLN Enterprises.
How Rural Development Helped:
The company’s roots date back to 1973 when the Tuffy Nelson family founded Barrel O’ Fun. The company was later sold but re-purchased by Nelsons through a $6.55 million Rural Development Business & Industry (B&I) guaranteed loan. The manufacturer has continued to grow in employees and products, from potato chips to pop corn. Recently, KLN’s Kenny Nelson received an $11.75 million Rural Development B&I loan through United Community Bank to expand its snack food manufacturing business.
The Results:
Cavanagh says these loans have allowed the city’s largest employer to remain local, not only providing jobs but also community service and leadership. KLN Enterprises also owns Kenny’s Candy, Tuffy’s Pet Foods, and Nutri-Source. All totaled, KLN and Tuffy’s employ approximately 600 people in Perham, MN.
Missouri:
Outline of Need:
Poplar Bluff Industries was awarded a $7.3 million Business & Industry Guaranteed Loan to finance the expansion of the Nordyne plant in Poplar Bluff, Missouri. Nordyne manufactures HVAC equipment.
The Results:
The project resulted in the creation of 400 jobs and saved the existing 400 jobs at the plant, and directly assisted two businesses. Poplar Bluff is located in Butler County, a persistent poverty and high unemployment area.
Missouri:
Outline of Need:
Dexter Chamber of Commerce Development Inc. was awarded a $2.6 million Business & Industry Guaranteed Loan to finance the purchase and remodel of a manufacturing facility in Dexter, Missouri. The facility will be leased to ArvinMeritor, a manufacturer of automotive components.
The Results:
The project resulted in the creation of 259 jobs and saved the existing 185 jobs, and directly assisted two businesses. Dexter is located in Stoddard County, which is a high unemployment area.
Missouri:
Outline of Need:
Premier Foods Inc. was awarded a $4.5 million Business & Industry Guaranteed Loan to finance the purchase of a poultry processing plant in Milan, Missouri. The plant provides a co-packing process with ConAgra, which is a value-added process. Milan is located in Sullivan County, which is a persistent poverty area.
The Results:
The project resulted in the creation of 80 jobs and directly assisted both the borrower’s business and ConAgra, the plant’s supplier.
Montana:
Outline of Need:
Morrison-Maierle, Inc. is an employee owned, Montana based, engineering firm growing with Montana. Founded in Helena, Montana, in 1945 the firm has provided continuous service to Montana and the Rocky Mountain West for 58 years. With 240 employee-owners (statewide), and $20 million in revenues, it is the oldest and largest Montana based engineering firm and has ranked among the Engineering News Record “Top 500 Design Firms” in the Nation for the last thirteen years; the only Montana firm to be so recognized.
Morrison-Maierle, Inc. in the past few years has expanded its service disciplines and operations resulting in significant staff growth that exceeded the office space located at 910 Helena Avenue, Helena. The growth required the leasing additional office space and locating some personnel outside the main office. The inefficiency of having staff in three different work areas has caused the firm’s management to pursue the construction of a new Helena office.
How Rural Development Helped:
With a loan in the amount of $4,480,000, Morrison-Maierle, Inc. was able to construct a new building in Helena after receiving a loan from Wells Fargo Bank of Helena. Rural Development’s Business and Industry (B&I) Guaranteed Loan Program provided an 80% loan guarantee.
The Results:
The new facility, brought about with the B&I Guaranteed Loan, will accommodate continued projected growth to approximately 110 personnel in Helena and allow for expansion on the site.
New Hampshire:
Outline of Need:
D&C Lumber Co., Inc., a sawmill in Springfield, NH, specializing in finished white pine boards, began operations in 1976. The business grew and has a reputation for producing a quality high-grade product. Durgin & Crowell is the largest employer in a town of 945 with very limited employment opportunities within commuting distance; paying wages with benefits of $4.7 million. Additionally, Durgin & Crowell provides for indirect employment for loggers, truckers, contractors, and pays +$100,000 in taxes to this small rural town. At the same time, D&C partners are connected through ownership and site location to Hemphill Power, which provides a needed market for inferior and waste wood to be used as biomass fuel in this neighboring electric generating plant.
D&C was hit with a natural disaster in March of 2001. A heavy snow load completely crushed the new 625’ x 125’ planing/finished inventory building. Besides the building, +$2.5 million of equipment was lost and $500 million of inventory was either ruined by water or destroyed in a subsequent cutting torch fire. The business was struggling to stay open and retain their 92 employees with 38% less production, in default of their loans, litigating insurance claims and facing closing.
How Rural Development Helped:
RD was invited in to meet with Congressional and Gubernatorial representatives along with State, Federal and local Economic Development Agencies to help find a way to save this business and the local economy. It was a complicated project that took a year to structure, but in the end, RD was able to guarantee a $5,000,000 loan from Banknorth Group, Inc. to Durgin and Crowell. Without RD’s daily hands-on participation and our guarantee, the deal would not have gone through and Durgin & Crowell would have had to close their doors.
The Results:
We are very pleased that a new larger building has been rebuilt on the old site, there are now two production lines running, D&C is performing as projected; ninety-two jobs were saved and 14 more created totaling 106 plus owners. These numbers do not reflect the positive effect this project has had on indirect employment, woodland owners and benefits generated for the community.
North Carolina:
Outline of Need:
The rural area of Piedmont North Carolina has suffered a significant loss of jobs over the past few years due to changes that have occurred in the textile and tobacco industries. In an effort to assist farm families having a small holding of land like a tobacco plot, The Old North State Winegrowers Foundation, a nonprofit organization, obtained funds through a Business and Industry Guaranteed loan and other partnering organizations to establish a 7,000-square-foot winery in Mount Airy, NC. In addition to a well-appointed tasting room offering a full range of hand-crafted wines, the winery has a large special events area, a fully equipped wine processing facility and a climate controlled barrel room. The foundation purchases grapes grown by some 38 local growers, who have an average of 5 to 6 acres of grapes each, and are members of the Old North State Winegrowers Cooperative.
How Rural Development Helped:
The two guaranteed loans identified above in the amount of $829,000 and $525,000, provided financing to establish the winery and to assist the grower cooperative with necessary working capital to get the winery in operation.
The Results:
The winery has provided farmers, who have a history in tobacco production from eight counties of the State of North Carolina, with alternative agriculture enterprises. In addition, they winery employs 12 people which includes a general manager, retail manager, wholesale manger, winemaker, three cellar assistants and five retail sales associates.
North Carolina:
Outline of Need:
Warm Products, which does business as “The Warm Company”, is a textile manufacturing company which employs 16 people in a 45,000-square-foot facility in Hendersonville, NC. Recently, company owners considered consolidating all of The Warm Company’s operations in its home state of Washington. The Hendersonville area, located in the western part of North Carolina, has historically depended on textile manufacturing to provide employment for many residents. Unfortunately, over the past few years many of these jobs have left the area and the loss of another manufacturing company would definitely create a hardship for the area.
How Rural Development Helped:
A Guaranteed Business and Industry loan in the amount of $1,100,000, provided by Pacifica Bank has allowed the company to open a second production line and maintain a presence in the Hendersonville area.
The Results:
There will be 6 new positions of employment created by the expansion within the next few months. The Warm Company has been in business for 16 years.
North Dakota:
Outline of Need:
La Rinascente Pasta is located in Hope, ND which is located in the Griggs-Steele Empowerment Zone in east central ND. The pasta equipment will be housed in a new building that will be built and owned by the Hope Development Corporation. The folded pasta “Fideo” manufactured at the plant will be marketed to the Hispanic population, primarily in the Eastern United States. Fideo products are primarily used as soup ingredients in Caribbean-based soups known as “Soupa de Fideo”
How Rural Development Helped:
This is a critical project in the empowerment zone and would not have been possible without USDA Rural Development and the Business and Industry Guaranteed loan. The B&I loan for $1.2 million to U.S. Bank assisted La Rinascente Pasta, LLC with permanent financing to purchase machinery and equipment for a pasta manufacturing plant.
The Results:
As a result of this project 20.5 jobs were created.
Oklahoma:
Outline of Need:
The Cimarron Trailers company manufactures aluminum horse trailers tailored for the rodeo and horse show industry. There are currently 19 dealers in 26 locations. Cimarron Trailers have 60 variations on their 4 base models of aluminum trailers.
How Rural Development Helped:
This company was awarded a B&I loan in the amount of $2,950,000.
The Results:
They currently employ 120 and plan to create another 30 new jobs for the Chickasha community
Pennsylvania:
Outline of Need:
Keystone Potato Products, LLC is a corporation created to use off-grade potatoes that other businesses would turn down and send back to the suppliers. Keystone will use these off-grade potatoes to provide a new potato source for other potato-producing facilities. Keystone will take these off-grade potatoes, mash them down and create potato flakes. These flakes will, in turn, be sent out to other facilities that produce potato products; and the overall potato waste will be cut drastically.
How Rural Development Helped:
A $4,995,000 Business & Industry Guaranteed Loan was provided for the development of an 86-acre site, construction of a new potato processing facility, purchase of new machinery and equipment, and start-up costs and working capital. $2,855,000 was put in the project by the borrower and private investors. They have also obtained a $450,000 USDA Rural Development Value-Added grant and $2,855,000 from Pennsylvania State Agencies.
The Results:
This new facility will not only cut costs for potato suppliers but will also create a new source for potato products facilities. 40 jobs were created as a result of this program.
Only one other plant comparable to this facility may be found on the East coast, and that plant is located in Canada which makes this Pennsylvania Corporation a prime choice for many East coast U. S. potato industries.
South Dakota:
Outline of Need:
Mettler Fertilizer, Inc. was awarded a loan in the amount of $1,500,000, which was used to complete business expansion at two new locations and the consolidation of debt for past expansion (about 1/3 of total loan).
The Results:
Jobs created/saved and businesses assisted: As a result of this program, 16 jobs were created. Currently the business has 35 full time and 20 part time employees.
Tennessee:
Outline of Need:
Tullahoma Industries manufactures uniforms for the U.S. Military. The business has plants located in Tullahoma and Gruetlie Laager in Tennessee, as well as Alabama.
How Rural Development Helped:
Loan funds were used to provide debt restructuring, purchase equipment and buy leased manufacturing facilities.
The Results:
As the result of this project, 49 jobs were created and 251 jobs saved.
Tennessee:
Outline of Need:
Olympic Metals provides quality cut metal products for various manufactures.
How Rural Development Helped:
Business used funds to purchase a new stretcher / leveler that are being used to provide high quality cut sheet metal products for various industrial and manufacturing users.
The Results:
As the result of this project, 18 jobs were created and 27 jobs saved.
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