The state has awarded low-interest business loans in six counties to spur job growth in several sectors, including the northeast region.
SAP Manufacturing, a plastics maker with facilities Jefferson Township, received a $400,000 10-year loan at a three-percent fixed interest rate. The funding will allow for the buying of manufacturing equipment, which will include plastic molding equipment and more land for its Lackawanna County site.
“There were a lot of moving parts to this one,” said Ken Doolittle, Business Finance Specialist with the Northeastern Pennsylvania Alliance, who helped put together the loan program with PIDA, the Pennsylvania Industrial Development Authority.
Doolittle said the point of the program is to fund projects that would otherwise not get funded.
“In the SAP Manufacturing deal, a traditional bank would not be able to give them the full funding,” he said. “They were able to about 40-percent of the total funding and then the Northeast PA Alliance also had additional funds that we injected as well, we made up the balance. If it weren’t for us and PIDA, the borrower would have to come up with 60-percent of the deal in cash. It’s one of the benefits.”
Doolittle also said the interest rates are lower. The project had a 3-percent loan, where a traditional loan could be almost double that amount.
“It offers them a little stability on their cash flow,” he said.
The total cost of the project is $1.55 million. The company said one full-time job will be created and it will retain 10 other jobs.
“In these types of projects, we look for one job to be retained or created with every $50,000 we lend,” he said.
The state also awarded a grant to Wyoming Valley Chiropractic for $35,939. The loan, with a fixed interest rate at 2-percent for 10-years, will funding the purchase of a digital imaging system for their Forty Fort Borough practice. The total cost is $47,919.
“It helps them get medical equipment at lower financing rates they normally wouldn’t get,” said Doolittle.
The Carbon Chamber and Economic Development Corporation was approved for a $2 million, 15-year PIDA loan at 1.75 percent for construction of a more than 16,000 square-foot building in Palmerton Borough. It wil bel part of the St. Luke’s Hospital System.
Bennett Family Properties is the developer of the project, said Kathy Henderson, director of economic development for the Carbon Chamber.
“The total cost is about $5 million for phase one and phase two for Saint Luke’s facility on Delaware Avenue in Palmerton,” she said.
The healthcare facility will add 25 new jobs as well as retaining 50 other jobs from other St. Luke’s facilities in Carbon County, which will be relocated.
“It’s a huge benefit for Carbon County,” she said. “St. Luke’s has been an amazing partner. They are servicing the county very well with all kinds of medical and healthcare services.”
Lab work, x-ray and physical therapy will be available when the project is complete. Urgent care is available now thanks to phase one of the project that is already finished.
“Healthcare is important to us and we need to keep those workers safe,” she said. “We need to keep them employed not only in Carbon County, but in our neighboring counties too.”
“The process to get these loans is lengthy,” said Doolittle, “but we take that burden on for the client. We stress that we can get an approval quicker than the bank. We try to be efficient.”
Doolittle said the Northeastern PA Alliance has done ‘hundreds’ of deals like this through the years, several in 2020.
In Northampton County, CryConcepts, LP received a $400,000 PIDA loan at 3-percent for 10-years. The money will be used to buy machinery that will aid in the company’s research. It will create eight full-time jobs and retain 20 jobs. The project was put together by the Lehigh Valley Economic Investment Corporation.
In 2020, PIDA approved more than $12 million in low-interest loans for businesses.