By DENNIS GRUBAUGH
Supporters are closing in on the launch of an incubator program to foster new business startups in the Metro East.
Paul Ellis, the director of economic development for Fairview Heights, has spent the last several months pulling together various resources, enlisting the support of state and local governments, local banks, educators and business support groups.
“There are still some things we’re working on, but basically it’s a regional approach to further assist startups and emerging businesses in the Metro East,” Ellis said. “We’ve defined our market for now as business in Fairview, O’Fallon and Swansea. That doesn’t mean we won’t be working more broadly than that, but that’s the target for right now. We’ve had expressions of interest from several communities, but we think we’ll start with a pretty good base.”
The entity will be known as Metro East Business Incubator Inc.
“We have registered as a nonprofit corporation with Illinois, adopted bylaws and formed the initial board of directors, and now we’re pursuing 501 (c) (3) federal tax exemption and anticipating that the City of Fairview Heights will be the fiscal agent,” he said. The city’s approval of that was still awaited at press time.
Ellis has briefed the City Council and other partners in the new project have been involved in discussions that have been under way since late last year.
In the next few weeks, in addition to moving ahead with documentation, supporters hope to get a lease on space at St. Clair Square mall starting in the summer.
“We’ll also have a management contract but don’t know which agency will take that lead. The incubator will be opened at least during the mall hours,” Ellis said. A contract will have to be negotiated between the not for profit and the city to act as fiscal agent.
He says the incubator is “a natural” and came out of a meeting in Springfield attended by Michael Holmes, the senior director of the Urban League in St. Louis; Michael Hagen, general manager of St. Clair Square; and Tom Tyler from the Metro-East Regional Chamber of Commerce. Holmes has been involved in establishing other incubators, including the one at the T-Rex operation in St. Louis.
By DENNIS GRUBAUGH
Businesses chasing after government contracts have a nation of opportunity in front of them, and they could have an inside edge if they’re part of the growing HUBZone network.
The Historically Underutilized Business Zones, or HUBZone, program helps small businesses in urban and rural communities gain preferential access to federal procurement opportunities.
Preferences go to small businesses that obtain HUBZone certification in part by employing staff who live in a HUBZone. The company must also maintain a “principal office” in one of the specially designated areas.
Illinois has a number of HUBZone areas, which are typically formed around low median household incomes or high unemployment areas or both. Federally declared disaster areas and expanded military base closure areas are also included.
Of the 6,758 small firms certified in the program, 125 of them in Illinois.
The advantages were laid out in a lengthy presentation in East St. Louis this past month at the SIUE Higher Education Center, put on by the Illinois Metro East Small Business Development Center and the Western Illinois University Procurement Technical Assistance Center. Nearly 200 people attended live or via an online hookup.
By DENNIS GRUBAUGH
Backers of small business are lining up behind an Illinois senator’s proposal that they say would improve microlending to entrepreneurs in both rural and urban settings.
U.S. Sen. Tammy Duckworth, D-Illinois, said the new legislation would help small-business owners secure the financing they need to grow their businesses.
Duckworth says “The Microloan Program Expansion Act of 2019” would improve the Small Business Administration’s Microloan Program to help more small businesses – particularly women, veterans, low-income and minority entrepreneurs. Those constituencies are often overlooked by traditional commercial lenders, she told a Senate committee earlier this spring.
“Small businesses are the backbone of the American economy, yet many of them struggle to access the capital they need to start or grow,” said Duckworth.
Duckworth’s legislation was praised by the president and CEO of Association for Enterprise Opportunity, Connie Evans, who is an Illinoisan and testified before the committee.
Duckworth’s legislation would expand the program to get more capital in the hands of businessmen by increasing the total amount of loans that lenders may keep on their books. The measure would eliminate an outdated rule that prevents SBA from distributing more than 1/55th of its funding in any given state during the first half of the year.
The old rule limited the program’s effectiveness. The measure would require SBA to report to Congress and the public on the success of the microloan program and how the loans help small businesses.
Some 55 percent of all small businesses seek loans under $100,000. However, a Harvard white paper found the largest gaps in financing are for loans under $50,000. Since 1992, the SBA Microloan Program has helped fill that gap by providing small-businesses owners with access to loans of less than $50,000.
The SBA microlending program is not available from a bank, only through nonprofit intermediaries, like Justine Petersen, a St. Louis-based company that assists low-income individuals and families to develop, maintain and increase financial assets.
Justine Petersen, which has a strong presence in Southern Illinois, is solidly behind the Duckworth bill, said chief communications officer Galen Gondolfi.
“We feel there is bipartisan support for the bill. Microlending is strategically attractive to both sides of the aisle. Both sides respect the interests of small-business people and understand their value,” he said.
In many ways a microlending program is a port of entry to mainstream finance for many businesses, he said.
Doing away with the 1/55th designation can allow for deeper penetration of microlending statewide, Gondolfi said.
One new Southern Illinois business, Officer’s Residence Bed and Breakfast Inn in Murphysboro, is using the microlending program to help pay for renovations, owner Trudy Daly said. She worked with Justine Petersen, after being connected to the agency by the Illinois Metro East Small Business Development Center at Southern Illinois University Edwardsville.
Boys and Girls Club of Alton named beneficiary of 15th Annual Simmons Employee Foundation Golf Tournament
Simmons Hanly Conroy says the 15th Annual Simmons Employee Foundation (SEF) Golf Tournament will benefit the Boys and Girls Club of Alton, an organization dedicated to enabling young people to reach their full potential as responsible, productive and caring citizens.