Aid offered to Balto. Co. businesses Local government and lenders seek to stimulate growth

$3.2 million in loans

Program is aimed at aging suburbs, in east, southwest

July 12, 1996|By Joe Nawrozki | Joe Nawrozki,SUN STAFF

In a continuing effort to resuscitate older communities, Baltimore County and 16 private lending institutions are offering $3.2 million in loans to stimulate small-business expansion and create new jobs.

"Some of these areas have been neglected for 30 years," County Executive C. A. Dutch Ruppersberger III said yesterday when he announced the program. "We hope this program will go a long way toward our plan of stabilizing families, neighborhoods and communities."

The loan pool, created in a partnership of the county and 16 banks and savings and loans, will provide maximum loans of $250,000 to eligible applicants in areas such as Essex-Middle River, Arbutus, Dundalk, Towson and Catonsville.

"It's a statement and a very important change for the county," said Linda Cotton, president of the Baltimore County Chamber of Commerce, a group with more than 700 business members.

"The power of that message is that 16 competitive institutions can work together for a common goal," she said. "This has been needed for a long time."

Eastern and southwestern sections of the county have been designated revitalization areas by county and state officials who have been trying to counter the loss of tens of thousands of manufacturing jobs since the 1960s.

For example, several dilapidated apartment complexes in Essex and Middle River will be torn down and planners hope to build affordable homes on the sites. A mini-Harborplace designed to lure tourists to Dark Head Cove near Martin State Airport could be a reality in several years, Ruppersberger said.

Under a pilot program that began this month, homebuyers in Hillendale over the next three years will get a 40 percent reduction in property taxes and a matching reduction in state income taxes.

Meanwhile, the county's first business enterprise zone has been established on 2,370 acres along North Point Boulevard, and county officials are contemplating another zone to boost industry in the southwestern area. Manufacturers within the zone can get tax credits of 80 percent on the value of new investment during the first five years and can receive one-time credits ranging from $500 to $3,000 for each new worker.

In a related move this week, Gov. Parris N. Glendening said the state will spend more than $46 million to spruce up decaying commercial districts and help families buy homes in older neighborhoods -- part of a campaign to slow suburban sprawl.

He announced the availability of $40 million in low-interest mortgage loans for more than 500 borrowers, including funds solely for home sales in older neighborhoods in Baltimore County and other aging suburbs.

Under the loan plan unveiled yesterday, the county will provide $300,000 as a reserve for guaranteeing 15 percent of each loan.

The participating lending institutions will provide the capital for qualified applicants.

The largest contributors to the pool, with $500,000 each, are NationsBank, First National Bank of Maryland, First Union National Bank and Crestar.

The pool, officials say, will help small businesses obtain fixed or floating rate loans on favorable terms.

The loans can be applied to real estate, fixed assets and working capital.

Councilman Louis L. DePazzo, a Dundalk Democrat, called the creation of the loan pool "a good infusion of cash. It's the first time I've seen private business step up to the plate like this. This is money they could lend at a higher rate, so I'd like to see more of this type of work."

Loan recipients must be located or plan to locate in Baltimore County and employ fewer than 75 people.

They also must have established relations with one or more banks participating in the program and meet other requirements.

For each $35,000 lent, a minimum of one job must be created, officials said.

Area chambers of commerce and the county Small Business Development Center will assist merchants applying for loans or provide other information to improve functions such as accounting and marketing.

Information

To apply for a loan or to get additional information about small-business counseling, contact the Baltimore County Department of Economic Development at 887-8000.

Pub Date: 7/12/96

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