How much of $3 million does your community need? by Rod W. Fouberg, SDRE board chair Over 65 revolving loan funds (RlFs), partnering with local financial institutions, provide capital and business assistance to companies and rural communities in South Dakota that typically do not qualify for traditional financing.
RLFs serve a vital role in making business development possible, especially for entrepreneurs, people with low and moderate income, tribal members, and people in transition, i.e. farm families. Economic development corporations exist in almost every community in South Dakota with a mission of growing the economic base of their communities.
South Dakota Rural Enterprise, Inc.(SDREI) is a private not-for-profit organization committed to making resources available to these institutions in South Dakota.
SDREI has raised over $5 million in the last 18 months to support the work of local community development organizations.
Of that total, $3 million is still in the bank. Why?
The answer to that question is not simple, nor is it the same for each community or organization that could access the capital. But here are a few of the obstacles to the use of these funds:
? The �Magic Manufacturer Approach� has communities saving their money in the hope of attracting an outside employer who will come �to save the day,� and not using the resources available to grow and expand existing local businesses.
? The �Grant Fund Approach� focuses on government grants as the sole funding source of an RLF, which may then not consider borrowing money as a realistic option for expanding the pool of available capital.
? The �Way It�s Always Done Approach� features a single loan product or strategy based on a single source of funds. It may be time to consider new ideas and loan products to meet evolving community needs.
SDREI is committed to supporting rural economic development, and has created the Capital Investment Fund for the state�s economic development industry.
The elements needed to make this strategy really take off and have an impact on the future of rural communities in South Dakota are:
? Vision � Communities and economic development organizations need a vision of how their communities are going to grow and prosper.
? Courage � The willingness to try something new, invest in local entrepreneurs, create new loan products, borrow money to expand local resources and take more risk is a necessary part of growth.
? Creativity � We must always be ready to innovate to find strategies that work.
? Tenacity � Success will not happen overnight, so we must be tenacious and work hard to realize the community vision.
? Cooperation � We are all in this together and need to work cooperatively with our neighboring towns, counties, and townships to strengthen the whole and improve our chances of success.
? Grace � Support community leaders who are willing to stick their necks out and do something � anything � to preserve and nurture the precious resource that is life in South Dakota.
SDREI exists to support those initiatives through cold hard cash, plus training and technical assistance to community organizations committed to making a difference.
We can help. We want to help. Contact us at 605-978-2804 or e-mail firstname.lastname@example.org for more information.