This year, the U.S. Congress is scheduled to pass a new Farm Bill. A small, but mighty, appropriation within the Farm Bill is the Rural Economic Development Loan and Grant (REDLG) program. The rural development titles in the farm bill represent less than half of 1% of the total Farm Bill, but programs like REDLG have made a big impact in our region.
The REDLG program is overseen by the U.S. Department of Agriculture (USDA), but the grant and loan dollars disbursed through the program require a local electric cooperative to administer the individual loans. That’s where Cherryland comes in.
Cherryland first worked with REDLG to help fund Blair Township’s water tower back in 1997. We have worked with the USDA to expand that program over time, and today we administer a $1.2 million revolving, zero-interest loan program. We have been revolving those loan dollars into the community for over 20 years. During that time, we have invested $5.2 million through 50 loans to 33 different local organizations. The loans range in size, but all require the recipient to create or retain one job for every $20,000 borrowed. The loan term is relatively short, at seven years on average.
This program is one of the ways we help support a healthy, growing business economy in the Grand Traverse region. While the money is lent at zero interest, we are reimbursed by the borrower for any costs incurred by the cooperative, up to $1,000.
Over time, we have helped purchase six fire trucks and ambulances for local first responders, provided funding for the Commongrounds Cooperative on 8th Street, and helped a local day care provider expand. We have also helped launch several highly successful businesses such as Iron Fish Distillery, Dave’s Garage, and Farm Club. We helped Centre ICE when they needed to upgrade their rinks to keep the Detroit Red Wings training camp here, and we’ve provided loans to several local manufacturers to help them invest in equipment to expand their production facilities.
We occasionally get asked why we choose to administer this loan program and my answer is simple — if we don’t do it, no one else can. These federal dollars must flow to local communities through electric cooperatives. We are deeply committed to this community. This is just one more way that we help our neighbors and drive federal investment into the region.
That’s why I was so excited when we were presented with the opportunity to partner with the USDA on a new loan offering this year. This loan program is a direct pass-through from the USDA to the end recipient, with Cherryland serving as the intermediary borrower. Unlike our other loans, we cannot revolve the funds; they must be paid back to USDA in full over 10 years. We just closed on our first pass-through loan this summer, working with Left Foot Charley to secure $1.3 million to help them purchase and upgrade a new production facility on M-72. With this expansion, they expect to increase production of their wines and ciders by 70% within the next three years and double their custom wine production for other regional wineries. We’ll share more with you about Left Foot Charley’s project in an upcoming issue of the magazine.
As our federal legislators work through the Farm Bill, we encourage them to continue providing strong support for rural economic development. We have a proud history of leveraging those dollars to support businesses in our community and are committed to continuing to do so.
For more information or to apply for a loan: Contact Dawn Garrock, [email protected].
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