Loan programs aim at boosting businesses

Upcoming restaurant is example of potential

By JO DEE BLACK
Tribune Staff Writer

Once she decided to strike out on her own, entrepreneur Julie Meyer lined up enough financing and cash to build a $500,000 restaurant and lounge.

The owner of Cattlemen’s Cut Supper Club says she is ready to stop paying rent and start building equity. Meyer’s business, which opened in 1998, is housed in leased space in Really Windy’s Lounge on Vaughn Frontage Road South.

But in June as bids started to come in, she quickly realized she was about $200,000 shy of what it will take to build the facility she wants.

Meyer’s credit is excellent. However, Stockman Bank was already lending her the most money it could for the amount of collateral and cash she had to put in the project.

Not an easy person to deter, Meyer was able to come up with some more cash on her own, but less than $200,000.

Instead of trimming back, her loan officer, Erin Townsend of Stockman Bank, suggested applying for money from High Plains Financial, the financing arm of Great Falls Development Authority.

High Plains is lending Meyer about $159,000, with the money coming from a revolving loan fund originally established to provide low-interest financing for Pasta Montana and National Electronics Warranty.

Money for the fund came from a $4.7 million grant from the U.S. Department of Commerce’s Economic Development Administration.

Payments from those original loans go back into the program to be lent to other qualifying projects in Great Falls and Cascade County.

"If High Plains Financial didn’t have programs such as this available, Julie would have most likely had to put off her project until she could save up more money," Townsend said. "This was just the niche product we needed to get her going."

Banks benefit from the programs too, since more of their clients can go into business with the financing they need, said Suzie David, director of the Small Business Development Center.

"And banks still get to be in the first position for collateral," David said. "It gives them additional security on commercial loans."

Although loans from the revolving loan fund can be extended for 20 years, terms usually include a balloon payment in three to five years, said Jim Kaitschuck, vice president of finance for High Plains Financial.

"We don’t lend money from this program without a bank’s involvement," he said. "The hope is that once the business is off the ground, the bank will want to take us out and have all the business available for themselves.’

Right now there’s about $1 million in the revolving loan fund available for new projects.

For Meyer, the additional money means she was able to break ground recently not far from where Cattlemen’s Cut operates now.

"We have outgrown our current space," she said. "We need more room."

The new Cattlemen’s Cut will have two dining rooms to seat 126 people, along with a 45-seat bar, a casino and a 36-seat lounge. When the new building is complete, Meyer will employ about 30 workers.

Today she has about a dozen employees.

"Customers will be able to come in to the restaurant through a separate entrance, not through the bar," Meyer said. "People won’t feel rushed to hurry through their meal because other people are waiting.

"I’ll be able to expand the menu, add more desserts. And I’ll have an office now, so I can get the bookwork and computer out of my house."

http://www.greatfallstribune.com/news/stories/20031030/localnews/546579.html