South Dakota Senate Panel Endorses Bill To Initiate Entrepreneur Fund

The state economic development program should include a special loan for entrepreneurs to start new businesses in South Dakota, a Senate committee decided Thursday.

Yankton Press & Dakotan

http://www.nasvf.org/web/allpress.nsf/pages/8453

The Commerce Committee voted 6-1 to endorse HB1145, which would set aside up to $3 million from the state’s economic development fund for loans to South Dakota entrepreneurs.

People starting small businesses could apply for loans of between $30,000 and $50,000. Applicants would have to provide funds equal to the amount of the state loan.

The bill’s sponsor, Rep. Joel Dykstra, R-Canton, said the proposal would help people who have an idea for a product or service and want to start a business.

He said South Dakotans who start small businesses create more jobs than companies who move in from other states.

Dykstra said the program could help entrepreneurs get through the difficult early years of starting a business because the loans could be unsecured and repayment would not begin for three years.

ŒŒIt hits those people who have an idea they’d like to get out of the garage,” he said.

Loan applicants would have to show a state board that they have an innovative business concept with a reasonable chance of succeeding. They would have to have a three-year business plan and have support from economic development experts or business consultants.

Marcia Hendrickson of the Enterprise Institute said such a loan program would help some struggling projects.

ŒŒSome projects have already died because of the inability of the entrepreneurs to leave their jobs,” she said.

The bill, which has already passed the House of Representatives, now goes to the full Senate for further discussion.