Featured photo: Winston-Salem city councilmembers approved updates to the city’s small business loan and building rehabilitation programs via the consent agenda on Jan. 8 (WSTV screenshot)
On Monday, the city of Winston-Salem voted to adjust two of its programs that aim to assist small businesses and help property owners revitalize commercial and industrial properties around the city.
The city has a small business loan program and a building rehabilitation program, and eligibility for these programs is tied to geography. These new adjustments will allow much more of the city to participate in these programs. The new recommended area will touch every ward in the city, but will mainly focus on the Northeast Ward, East Ward and Southeast Ward.
Ken Millett, the city’s business inclusion and advancement director, told city councilmembers on Nov. 14 that the building rehabilitation program “provides matching forgivable loans to owners of commercial and industrial property to encourage them to invest in their properties that may be underutilized, they may be disinvested, they may be blighted.” The applicant/borrower must be the property’s owner in order to participate in this program.
Historically, the building rehabilitation program has operated as a reimbursement program. Participants paid for everything at one time. Once they completed the entire project and submitted receipts to city staff, then they would get reimbursed.
However, not everyone has the ability to front that money, leaving those who are less privileged out of the conversation.
“Not all property owners are gonna have that financial ability to pay up front,” Millett said.
To combat this, the city will now disburse matching funds once participants submit their invoices and it’s been verified that construction has been satisfactorily completed. This eliminates the need for the borrower to float the amount of the building rehabilitation loan in order to pay the contractor.
“That will ease the burden on the property owners of financially having to carry the cost of the entire project,” Millett said.
Previously, the minimum private investment to be eligible for the program was previously $2,500; now it’s $5,000. The city is also increasing their maximum loan amount from $10,000 to $20,000. This loan will be deferred for three years, and the entire loan amount will be forgiven as long as the property and site are maintained and are in building code and zoning compliance. During this three year period, the owner cannot be cited as a chronic violator of any property they own in the city, otherwise they will have to pay back the loan.
City documents state that funds may be used to restore, repair or replace windows, doors, exterior walls, chimneys or other architectural elements, install building signage that clearly identifies the business, as well as the removal of modern facades to restore vintage quality. Participants can also make interior or exterior improvements addressing building code compliance and health and safety issues. Other eligible improvements include parking lot and landscaping improvements if they are part of a larger storefront improvement plan. Ineligible projects include property acquisition, the removal of historic details and improvement of adult businesses. Design fees and permit fees are also not eligible.
This is an incomplete list of all eligible and ineligible projects. Read more here.
For the small business loan program, the minimum city loan amount is $5,000 and the maximum is $100,000.
This money can be used for acquiring properties as well as constructing or rehabilitating commercial buildings and structures. It can be used to purchase equipment and fixtures, for energy conservation improvements and for working capital or operational funds. It can’t be used for things like acquiring, constructing or rehabbing government facilities, schools, hospitals and more. Participants can’t put the money toward political activities, income payments or housing construction. Read a more complete list here.
This loan program also aims to help promote job creation. For every $35,000 borrowed, one full-time job must be created and businesses must make half of the jobs created available to low-to-moderate income persons.
While credit history will be considered in the loan committee’s evaluation, there is no minimum score or credit history standing required for eligibility.
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