LAKEPORT — Locker Room owner Carlos Lopez is a good example of how government is trying to stimulate the local economy by using grant money to provide low-interest loans to businesses.
“Let”s say a business wants a $150,000 loan to expand, and the bank can only loan them $100,000. We stand in the gap by financing the additional $50,000,” Lake County Chief Deputy Administrative Officer Matt Perry said.
The City of Lakeport and the county both use money from the state”s Community Development Block Grant (CDBG) to that end, and use the money businesses repay to fund future loans. One of the conditions of the loan is that the business must create one full-time job for every $35,000 it borrows, according to officials.
“This is helping the community shop local. Not only do our sales dollars stay here, but our gas stays here, too,” Lopez said.
He received a $105,000 loan from the City of Lakeport earlier this summer to help consolidate some debt and keep his doors open. Lopez said before he opened his sporting goods store two years ago, the merchandise he offers was largely unavailable in Lake County.
“You always had to go to Santa Rosa to get a good pair of basketball shoes, or soccer or football,” Lopez said.
Locker Room sells “anything to do with sports,” according to Lopez, including shoes, clothes, specialized jerseys and equipment. He said conditions of the loan require him to create three new jobs in the next three years.
“The benefit is supposed to go to the low and moderate income group,” Lakeport Redevelopment Director Richard Knoll said.
Knoll said that means the business borrowing the grant money must hire people in those groups, which are the targeted benefit groups for the CDBG program. He said any business can apply, but most applicants are smaller businesses.
“This tends to be kind of a niche program for those businesses that might not be otherwise able to access conventional financing, or maybe they can access conventional financing, but maybe not enough to do what they would like to do. That”s where we come in to provide assistance,” Knoll said. Perry said the money comes from the federal Department of Housing and Urban Development. The state Department of Housing and Community Development gives the money to county and city governments through its CDBG program to loan to businesses. The county and Lakeport have been doing that since 1994.
Since then, Lakeport has loaned more than $1.1 million to 27 businesses in the city. That money came directly from three loans, one in 1994, the next in 1998 and the most recent in 2001. Knoll said the city has made eight more loans using the money businesses have paid back.
For more information or to apply in Lakeport, call Knoll at 263-8840. To apply in the unincorporated areas of Lake County, call Perry at 263-2580.
Contact Tiffany Revelle at trevelle@record-bee.com.
