Revived business investment sparks surge in KABA’s Revolving Loan Fund
The program makes low-interest loans available to businesses throughout Kenosha County, stimulating business growth and expansion and encouraging private investment and economic development.
It was the second-best year on record for the financing program, which began in the 1990′s and has provided over $50 million in loans to Kenosha County businesses since its inception.
In 2011, KABA loaned $5.34 million to eight businesses in Kenosha County—the highest sum in 12 years for the program and more than 2009 and 2010 combined.
KABA President Todd Battle was cautiously optimistic about the implications related to the increased use of the fund. “We are not declaring victory when it comes to turning the economy around, but this is one encouraging indicator that points to a more robust economy in and around Kenosha,” Battle said. “Businesses are investing in their facilities and workforce and that bodes well for Kenosha County.”
Businesses that received the loans in 2011 estimate the projects supported by the funds resulted in the retention and creation of more than 550 jobs. That’s part of a legacy, dating back to 1991, in which loans derived from KABA and its predecessor organization, the Kenosha Area Development Corporation, have helped retain or create thousands of jobs.
Money obtained via the loans can go toward a variety of projects, from the purchase of equipment to a company’s relocation to expansion of facilities.
For Offsite LLC, a $1 million loan approved by KABA in July 2011 was part of a larger financing package of $2.5 million. “It’s allowing us to double our data center space that’s available for new customer acquisition,” said Offsite co-founder Joe Rickard. “When we get a client, we need a certain amount of electric power and data communications available. When you look along the Chicago-Milwaukee corridor, it’s one of the most active areas in the country for data centers.”
KABA sees the revolving loan fund as not only a catalyst for immediate business growth, but as a long-term tool to attract and retain businesses. “In the case of Offsite,” said Rickard, “the company has drawn several large public companies as clients that would not otherwise have had Kenosha on their ‘business radar.’” Rickard said that KABA officials “were very easy to work with” and that same cooperative spirit originally attracted Offsite to locate in Kenosha a decade ago.
Allied Plastics, which received a $615,466 loan package in June 2011, is among those companies that have tapped into the revolving loan fund on multiple occasions. This time around, the funds are being used to purchase equipment to expand the company’s production capabilities. Tim Neal, Allied Plastics’ owner, said the loans have played an instrumental role in helping grow his company, which designs and thermoforms custom plastic products and reusable packaging for a variety of industries.
When Allied Plastics first secured a KABA-backed loan, in 1997, it had about a dozen employees; that figure has risen to nearly 110 today, including an increase of 24 in the past year alone.
This past year, KABA departed somewhat from its traditional model that focused on industry, specifically manufacturing, to include smaller projects in the downtown area.
In August 2011, KABA loaned Rustic Ventures, LLC, $82,500 to launch Rustic Road Brewing Co. in downtown Kenosha, scheduled to open in the spring.
Greg York, Rustic Road’s owner, learned about the organization’s vision to help redevelop the downtown, which led him to apply for a loan for his nano-brewery and bar. The money is going toward building improvements, brewing and bar equipment, and working capital as the brewery gets under way.
“It has been a good fit,” York said. “And (KABA Director of Business Finance) Rich Rodenbeck has helped spur me on to dig deeper in my business planning.”
Battle said Rustic Road’s restoration and occupancy of what had been a vacant building in the Downtown Area is aligned with the Kenosha First economic development strategic plan that KABA recently developed. The plan called for a renewed emphasis and additional resource allocation to the main street retail district just off of Kenosha’s redeveloped lakefront.
The Kenosha Area Business Alliance is Kenosha County’s economic development organization and employers’ association. KABA provides a range of economic development and business services to its nearly 400 member investors and to prospective members as well. KABA manages a portfolio of economic development revolving loan funds that are used to provide low-interest loans to new and expanding businesses to support job creation. Additionally, KABA serves as a clearing house for site selection and economic information. KABA also delivers a number of training programs designed to upgrade the skills of area workers.
Through its education foundation, KABA plays an active role in the Kenosha area’s education system including an elementary school mentoring program, annual scholarship awards, and support for various technology-related initiatives.