State treasurer touts revised low-interest loan program
Hannibal Courier-PostDANNY HENLEY
Wednesday, September 30, 2009
Clint Zweifel knows the key role that small businesses will play in the economic recovery. That is why one of his first duties as state treasurer was to try and revamp the Missouri Linked Deposit Program.
"There are lots of economic development programs that you hear about in the news, but most of those aren't targeted to Missouri's smallest businesses. Those are the businesses that need the most help during an economic downturn and those are the businesses that are actually going to grow the most during an upturn," he said during a stop at the Courier-Post Wednesday morning.
Through bipartisan support in the Legislature, the program has been expanded. It lowers the cost of borrowing for farmers and businesses.
"For a lot of small businesses 2 or 3 percent could be the difference between not being able to make it in a tough economy," said Zweifel, noting that qualified applicants can secure low-interest loans to increase operations, make reinvestments and even refinance.
Zweifel is pleased to note that the process of securing a loan is now much faster. Gone are the days when an applicant has to wait over a month.
"There's regulations in place, but we've minimized them. You either qualify or you don't. It's not a political sort of thing to qualify. It's really a program that's meant to connect government to citizens in a way that is productive and helps them," he said, estimating that most loans now take only one to two weeks.
The new and improved program also revises a policy that had been in place for half a century which saw the state receive little interest on the money set aside for loans.
"Essentially we were handing over about $500 million a year, sometimes more, sometimes less, and not getting a fair market rate return for our deposits in Missouri banks," said Zweifel, adding that under the new law those deposits of roughly $550 million receive the market rate for interest. "We think we can double eventually the number of investments we're doing inside the state because it's no longer a choice between reinvesting in the state and taking care of taxpayers. We can do the right thing for taxpayers and reinvest inside the state."
On Wednesday, Zweifel was in Northeast Missouri to visit Hannibal Machine Inc., which has participated in the loan program.
"The lower interest rate my company has received because of the Missouri Linked Deposit Program has allowed me to expand into agriculture parts production through a new business I started called Tri-State Ag products," said Harold Haycraft, president of Hannibal Machine Inc., in a press release. "This program offers a good tool, especially in these tough times.
About 100 banks throughout Missouri use the Missouri Linked Deposit Program. Local participants include F&M Bank and Trust Company, Hannibal National Bank and Palmyra State Bank.