5Q: Thomas Hoagland | Executive director, Providence Business Loan Fund
1. How many active loans does PBLF have, and what are they worth collectively? PBLF has 40 active loans in our portfolio with an original principal of approximately $9.79 million, and outstanding principal balance of $6.79 million. We have $1.5 million available for new loans.
2. What changes have been instituted in lending practice since the U.S. Department of Housing and Urban Development identified deficiencies? In 2012, HUD identified a number of deficiencies with the then-Providence Economic Development Partnership, which the city took immediate action to correct. In 2013-2014 we limited new lending activity to confirm that our documentation and monitoring activities were fully compliant with federal regulations and … relaunched in 2015 as PBLF, with a reconstituted board of directors who now approve all new loans.
3. What are some recent examples of completed loans? Over the past few years, we have made loans to Providence-based businesses such as Farm Fresh Rhode Island, a nonprofit urban agriculture campus in the Valley neighborhood, and Walco Electric Co., a nearly 100-year-old, family-owned business in South Providence, among others. Past loans made to Rising Sun Mills LLC, Franklin Rogers Menswear and Rhode Island Monthly have been retired and are all still operating successfully.
4. When do you anticipate being able to secure federal funds again for lending? Currently, we are receiving $50,000 to $60,000 per month in loan repayments and these dollars are immediately available to re-lend. If further needs arise, and if there are loan and grant funds available from federal sources, we will, of course, apply.
5. What kinds of businesses are not eligible for loans, and are some industries given more scrutiny than others? Federal regulations prohibit lending to certain kinds of businesses, including entertainment and sports facilities, among others. The board views each application on its merits and considers the impact on the city and its environment. We want to support the mayor’s emphasis on the core economic-development areas [food, makers, smart cities and health innovation], the two innovation districts, and the growth of small-business corridors throughout the city. Our primary mission is to create employment opportunities and our target is to grow and expand established businesses.
Mary MacDonald is a PBN staff writer. Contact her at Macdonald@PBN.com.
