Funding Business in Today's Challenging Economy

WRITTEN BY PETE BARDUNIAS, SENIOR VICE PRESIDENT, MEMBERSHIP AND COMMUNITY ADVANCEMENT,
CAPITAL REGION CHAMBER | PHOTOS PROVIDED

ecuring enough operating or investment capital is often a very difficult thing for a business owner, especially as the company grows from a startup to a more established operation. Traditional funding such as that offered by banks and credit unions are trusted resources, but gaps often appear due to the nature of underwriting loans and assessing risk. There are non-traditional sources of financing, plus special aids that have appeared in recent years to help businesses deemed desirable to attract for economic development, impacted by the COVID-19 crisis, or located in under served neighborhoods.

“Funding is not one-size-fits-all, so access to a portfolio of opportunities is critical to helping businesses grow,” says Katie Newcombe, Chief Economic Development Officer, the Center for Economic Growth (CEG). “Additional or more flexible resources are often needed to complement traditional funding sources. Fortunately, in the Capital Region, we have strong public and private partners that help our companies succeed.” There are a host of grants available to manufacturers for training, productivity project and growth projects. The top 6 are listed on CEG’s funding page. www.ceg.org/grow-here/grant-loan-assistance.

The CEG funding page is quite a good resource in identifying and locating grants and funding available throughout the Capital Region for businesses large and small, including specialties such as manufacturing and the tech sector, and highlighting not only the many traditional sources of funding from banks, etc. but also the various local programs, unique resources and available IDA support in one easy to navigate spot.

If you are a manufacturer, companies such as National Grid can often assist through their ShovelReady program. National Grid’s Economic Development Department can utilize NY Public Service Commission approved Manufacturing Productivity Economic Development grants to help manufacturers who need assistance to develop new products or implement lean manufacturing, to produce critical items to support the pandemic response. Funding will be made available to eligible manufacturers working with their regional NY State Manufacturing Extension Partnership (MEP) centers on eligible activities (according to their website). For more information and complete details on the program please visit shovelready.com.

An IDA or Industrial Development Agency is a public benefit corporation established under New York State’s General Municipal Law and the Public Authorities Law to foster economic development in specific localities. For example, the Saratoga County IDA (saratogacountyida.org) was created in 1971 to “promote, develop, encourage and assist in the construction, expansion, and equipping of economically sound industrial and commercial facilities in order to advance the job opportunities, general prosperity, and economic welfare of the citizens of Saratoga County” (as described on the IDA website). The Agency provides financial assistance and incentives to the business community of Saratoga County to create and retain jobs within the County.

The Saratoga Economic Development Corporation (SEDC) works alongside the county wide IDA as well as some local ones such as Clifton Park or Mechanicville, chambers of commerce, local downtown business groups, banks, utility companies, Empire State Development (ESD), the Center for Economic Growth (CEG), elected officials, and other resources in order to manage economic development projects, negotiate incentives, and bridge the gap between government and the business community as site selectors consider Saratoga County for their next project. Tax breaks and so-called Payment in Lieu of Taxes programs (PILOT) are various ways that companies can find help with the cost of locating in Saratoga County, though those breaks tend to be out of the reach of the average entrepreneur.

Entrepreneurs need not despair however – there are some interesting financing options to pursue. If you are starting a business or have an early-stage company with smaller capital needs, the Capital Region Chamber has a microloan program that could be considered. Through management of different public and private monies, the Chamber provides financing in amounts from $1,000 to $50,000 for eligible companies within Albany, Rensselaer, Saratoga, and Schenectady Counties. There is also a multi-county, regional program called the Capital Region Advancement Fund that assisted Saratoga County businesses to the tune of $1.575 million in 2021, with funding from the CARES Act. It is in the process of transitioning to a permanent revolving loan fund that will continue to assist businesses starting in 2023. Details on both loan programs can be found at capitalregionchamber.com/loan-programs.

Empire State Development has been working with organizations such as the Capital Region Chamber and others to provide a resource called the New York State COVID-19 Pandemic Small Business Recovery Grant Program to area businesses. This program provides flexible grant assistance to currently viable small businesses, micro-businesses and for-profit independent arts and cultural organizations in the State of New York who have experienced economic hardship due to the COVID-19 pandemic. For details, please visit nysmallbusinessrecovery.com.

Finally, there are other sources that may be outside the normal scope of where businesses look for support. The Workforce Development Institute (WDI), for example, has childcare subsidies that might help employees with families hold jobs that they otherwise would struggle to work into their challenging schedules. They also research trends in other areas such as manufacturing and the energy and climate sector and provide business resources. Some financial institutions such as SEFCU offer programs like Fresh Start, which can provide small amounts of financial assistance for individuals who wouldn’t normally qualify for loans under traditional underwriting methods. And there is even a site called bizideashower.com, where early-stage business startups can sign up on a gift registry and supporters can offer a “shower” of such gifts to help them get started!

You can indeed start a business in the Capital Region, and keep one going, from the tiniest of home-based businesses all the way up to the mightiest of world class manufacturers. The resources discussed above will hopefully be of help in doing so.