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City unveils new revolving loan idea

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Lisa Dunlap Photo City Manager Joe Neeb, as seen during an October 2019 city forum.

Copyright © 2021 Roswell Daily Record

Program would help local

businesses grow, renovate buildings

Roswell City Manager Joe Neeb has unveiled an idea to spur economic growth in Roswell over the long term.

It’s a revolving loan program that would be managed by the Roswell-Chaves County Economic Development Corp.

“We have been working on this for a little while, trying to find other ways that we can help support our businesses in this city,” said Neeb.

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Neeb told members of the Roswell City Council Legal Committee that the city has had different iterations of a revolving loan fund over the years, including a now-defunct fund to help businesses at the former air base, now called the Roswell Air Center.

A different city program that received federal funding in 1988, the Community Development Revolving Loan Program, still has $1.2 million earmarked for it, Neeb said.

The city is recommending that the money be used for the new program and that the Economic Development Corp. be given an initial investment of $150,000 to $250,000 as seed money.

“Let’s put this money back to use,” Neeb said.

According to city documents still under consideration by elected officials, the loan program would actually consist of two types of funding mechanisms, the Roswell Opportunity for Advancement Revolving (ROAR) Fund and the ROAR Building Facade Rehabilitation Loan Program.

The larger ROAR fund would start with about $150,000 in total funding, and loans could be used for building or land acquisition, building renovation and repairs, installed equipment, improvements to industrial parks, or for operating funds for the Roswell-Chaves County Economic Development Corp. As conceptualized now, the size of the loans to businesses would depend on how many jobs were supported by the enterprise.

The smaller Building Facade Rehabilitation Loan Program, to be seeded with about $50,000, would allow the owners or tenants of Roswell buildings to receive $2,500 to $10,000 for up to five years for renovating or repairing the building.

Neeb said that potential uses of the money could include installing fire suppression systems or upgrading buildings to meet the requirements of the Americans with Disabilities Act.

“Those are expensive systems,” he said about fire sprinklers, “and that is why some of our old buildings have become very hard to renovate.”

The Building Facade Rehabilitation loans ideally would be given in conjunction with a loan by a private lender or in conjunction with other grants. They also could supplement an EDC facade grant program, which gives up to $10,000 to local building owners or tenants for exterior improvements.

“With the pandemic we are facing right now and the conditions that businesses are finding, I think this revolving loan program becomes even more important to our community as an opportunity to receive some gap financing,” Neeb said.

Something similar to the Building Facade Rehabilitation program was broached during the 2020 Legislative session. The Main Street Fire Suppression Equipment Tax Credit, which was supported by local officials and the New Mexico Main Street organization, would have allowed organizations within Main Street economic districts to receive tax credits of up to $50,000 as reimbursement for installing approved fire suppression systems. The state House of Representatives passed House Bill 145 unanimously, but it did not make it out of committee in the Senate.

Numerous other cities and counties through the United States have instituted revolving loan funds intended to spur economic development. In New Mexico, the city of Santa Fe has a fund for small businesses. A different type of revolving fund, one meant to help organizations pay for the cleanup of “brownfield” sites, has been established by the city of Albuquerque.

All three members of the Roswell City Council Legal Committee — Chair Judy Stubbs, Jason Perry and George Peterson — voiced their support for the ROAR program. They voted 3-0 to have the entire City Council consider the idea during its May 14 meeting.

Senior Writer Lisa Dunlap can be reached at 575-622-7710, ext. 351, or at reporter02@rdrnews.com.

 

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Lisa Dunlap is a general assignment reporter for the Roswell Daily Record.