Micro-Loan Plan Suggested By Downtown Cda Advocate

Coeur d’Alene Downtown Association Director Malcolm Johnstone is floating the idea of a micro-loan program to aid downtown merchants.

Johnstone made a pitch to the Urban Renewal Agency last week for $60,000 to fund the program, which would provide $2,500 to $25,000 loans.

Small businesses face “a gap in capitalization,” Johnstone said in an interview.

Often, banks don’t want to provide small-business loans under $25,000, he said. But the small amounts are often critical to start-up or expanding companies.

“It’s meant to be an alternative when someone doesn’t qualify for a conventional loan,” Johnstone said.

Recipients would be required to participate in extensive business counseling. The loans and the counseling would strengthen the economic health of downtown, a predominantly small-business area, he said.

Urban Renewal Agency members aren’t sure they could legally fund such a program. The agency’s budget comes from tax-increment financing, and the money is intended for public projects, board member Nancy Sue Wallace said.

URA members tabled the request at Wednesday’s meeting, and sent the proposal to staff for further study.

For fairness, the micro-loans would also have to be available to companies in the entire urban renewal district, Wallace said. The area includes downtown, Northwest Boulevard and Fourth Street.

Johnstone said he made the request on behalf of agency members, who wanted suggestions for spending $60,000 earmarked for business recruitment and retention.

“I’m delighted the agency is … developing a program to assist the small-business person who wants to invest in Coeur d’Alene,” he said.

But business recruitment is a broad area, Wallace said.

The agency is discussing several other high priority projects right now, including a plan to redesign public space downtown. The agency is also studying its bonding ability in light of a $1.2 million request for infrastructure improvements in the Riverstone development along Northwest Boulevard.

“We’re looking at the most effective ways to use money for business recruitment,” she said.