In the past three years, Hillsboro E-Community loans helped six businesses get started in Hillsboro. Now the entrepreneurial board is working to jump-start three more hometown projects, Hillsboro Economic Development Director Clint Seibel told City Council members last week.
“This money we use to help these businesses does not come from tax money and it is not from our mill levy,” Seibel said. “We are using credit money.”
Seibel explained that the city of Hillsboro joined Network Kansas in 2009 and after an application process, was designated an E-Community. Cities in partnership became eligible for up to $300,000 in Kansas tax credit money placed in a revolving loan account.
Network Kansas, established by the Kansas legislature in 2007, provides a funding source for business start-ups and expansions.
“I’m not a lone-ranger trying to work with Hillsboro businesses myself,” Seibel said. “Network Kansas has opened up some doors for us. I have a guy from there who calls me every so often and asks how it’s going. We have a support system.”
Seibel said Hillsboro has already received more than $50,000 because of involvement with Network Kansas.
“We are following a hometown competitiveness model for growth,” Seibel said. “We have to focus on certain areas to be successful.”
Seibel said there were four pillars of the hometown model: economic development, wealth retention, youth attraction, and leadership development that created rural opportunities for towns like Hillsboro.
He said economic development in Hillsboro needed to focus on entrepreneurship because that would bring in more jobs through business start-ups and expansions than recruitment.
“Recruitment hasn’t filled the bill for us,” he said. “We need to support entrepreneurship because only three percent of jobs in the past several years have come from business recruitment.”
Businesses helped by E-Community loans in the past three years include Jostrux Upholstery and Graphics, Lalouette Law LLC, Shred KS, Olde Towne Restaurant, Kessler’s Kreations, and Tangles Hair Salon.
“A bank has to be the primary loaner on these things,” Seibel said. “But we can come in as a secondary.”
Of the businesses helped, Jostrux paid off their E-Community loan, Shred KS paid off their loan then liquidated their business and moved out of town, Olde Towne Restaurant went bankrupt, and Kessler’s Kreations, Lalouette Law, and Tangles Hair Salon continue to operate in Hillsboro.
“We were not successful in all our attempts,” Seibel said. “But we are here to do what we can.”
Seibel said benefits to businesses using the E-Community loans included the present 2 percent interest rate.
“E-Community funds can be loaned as second mortgages with no loan fees and five- to 10-year fixed rate loans,” he said.
Seibel said Hillsboro Community Foundation focused on keeping wealth in the community, and his job as economic director was to make sure attention was paid to developing businesses, attracting and keeping young people in town, and developing leadership.