PAWTUCKET — Calling it “ a seeding of the new economy,” Keith Stokes, executive director of the Rhode Island Economic Development Council, was one of several state and local officials to tout the importance of a new $13.1 million stimulus grant awarded to small business financing programs in the state.
Stokes, along with Gov. Lincoln Chafee, U.S. Senators Jack Reed and Sheldon Whitehouse and U.S. Rep. David Cicilline, joined with Pawtucket Mayor Donald Grebien at Hope Artiste Village to announce the financing program. As alluded to by several of the speakers, the site of the former candy factory at 1005 Main Street was chosen because it symbolizes both the adaptive reuse of an old mill complex and is a hotbed of various small businesses and start-up ventures.
The $13.1 million in federal funds will help finance small businesses through the U.S. Treasury Department's State Small Business Credit Initiative (SSBCI). The program was established by the Small Business Jobs Act of 2010.
Stokes said the $13.1 million in federal money will be leveraged over 10 to 1 to Rhode Island-based technology companies and small businesses in urban communities that need credit.
As such, it will eventually generate a total of about $130 million in private investment capital going to local companies around the state. He described the loan program as offering “seed money” which would allow a company to get up and running. The company would then have to identify and raise ten times that amount in private investment capital.
“This will help not only in attracting new businesses to come in, but to help those that are existing to grow and prosper,” Stokes said. He added that Pawtucket, in particular, is in a strong position to increase its economic development due to its close proximity to major highways, its inventory of existing mill buildings, amount of available parking, and affordable real estate prices.
Gov. Lincoln Chafee said that Rhode Island's strength in economic recovery lies in its small businesses and said this grant is a model to sustain the technology sector and urban businesses. Of the $13.1 million, $9 million will be going to Slater Technology Fund, which provides seed funding for local technology-based ventures in the IT and life sciences industries; $2 million to Betaspring, a Providence-based start-up accelerator program for technology and design entrepreneurs; and $2.1 million to the Rhode Island Economic Development Corporation's Small Business Loan Fund.
Sen. Jack Reed said the stimulus grant came about as a public/private partnership designed to advance small start-ups. He also noted the importance of the $13.1 million being leveraged into $130 million in private investment as a means of boosting the state's economy.
“Our ultimate challenge is jobs, and getting jobs to Rhode Island,” stated Reed. He added that the state has a “great pool of human resources” in its talented young men and women, and with the guidance of the state ECDC and this new funding, the employment picture is poised to improve.
Sen. Sheldon Whitehouse said that since the “Wall Street meltdown” two years ago, the credit drought that ensued “has not been remedied.” He said he hears about problems all the time from people with good ideas who can't get financing for their business or start-up. “So, this program really fills the niche for small business credit,” Whitehouse said.
Rep. David Cicilline agreed, noting that small business owners need not only customers but capital in order to survive, and said the new loan program is a model that will work efficiently. “These federal dollars in turn will leverage millions of additional dollars in private lending and capital—further supporting small businesses, the proven job creators and engines of our state's economy.”
Pawtucket Mayor Donald Grebien referenced Slater Mill and the vision of Samuel Slater as being the start of America's economic engine over 200 years ago, and noted that the future of economic development in the region still lies in individuals with creative, entrepreneurial spirit and in small businesses.
Grebien pointed to Hope Artiste Village, where 81 different businesses employing some 250 people make up the once-vacant manufacturing space, as an example of a successful mill reuse. He said the future economic development of Pawtucket, as in other urban communities throughout the state, will require new sources of funding to spur additional private capital investment and complement local and state economic development programs.
The mayor added that the new federally funded economic development program that brings $13.1 million in new capital to small businesses and entrepreneurs, “will help Rhode Island grow and create quality, high-paying jobs.”