Seven local banks have made $1 million available for loans to start or expand companies in city business zones.
The banks would lend the money through the Altoona Renaissance Loan Program at interest rates lower than market or for longer-than-normal terms, to help make projects feasible that wouldn't be otherwise.
One bank already agreed to lend Henderson's Printing Inc. $64,000 at below-market interest over five years to help install a $160,000 system to create printing plates for presses directly from a computer, according to Steve Metzger, director of business funding for Southern Alleghenies Planning and Development Commission.
Southern Alleghenies supplemented the loan with $80,000 at 3 percent over five years, reflecting the value of the Renaissance program in helping "leverage" other funding for projects, Barry Surma of Altoona Blair County Development Corporation said.
For example, with the help of the Renaissance program, a company that might face $7,000 a month in loan repayments - too much to handle based on projected cash flow - might be able to get more manageable $5,000 a month repayments, said Steve Foreman of M&T Bank.
Foreman doesn't expect the banks to relax their standards of credit-worthiness.
Participating banks: Reliance Bank, Altoona First Savings Bank, First Commonwealth Bank, C&G Savings Bank, Investment Savings Bank, First National Bank, M&T Bank.
Size of loans: $10,000 to $100,000.
Uses: Inside renovations, roofing, permanent mechanical systems, equipment, design, landscaping, green-building initiatives, code work - but not refinancing or regular maintenance.
Eligible zones: Central business, neighborhood business, industrial, light industrial (to 31st Street) and mixed use.
Eligibility considerations: Economic impact, contribution to milieu of area, use of existing buildings, including upper floors, ability to complete project, match with city Comprehensive Plan and codes.
Repayment terms: From 60 months to 120 months.
The banks could benefit by receiving credit for fulfilling their obligations to invest in their local communities, a requirement of the Community Reinvestment Act, he said.
The banks also will benefit generally by helping their communities prosper, he said.
The program came out of a GAEDC committee that worked on "visioning" recommendations from the city a couple years ago.
The program is broader than older loan programs and cures one of the deficiencies of the city's Economic Development Loan Fund, which requires use of prevailing wages and raises project costs, said Patrick Miller, executive director of GAEDC.
Mirror Staff Writer William Kibler is at 949-7038.