By Jonathan Sanders
From the March/April 2015 issue
The Nebraska Department of Economic Development (NDED) has announced that the state has received its third and final installment of $4,477,239 to assist with new business development, job creation and angel investments through the U.S. Treasury Department’s State Small Business Credit Initiative (SSBCI).
The state was awarded a total of $13,168,350 in October 2011 to create the Nebraska Progress Loan Fund (administered through NDED), and the Nebraska Progress Seed Fund (administered through Invest Nebraska). Invest Nebraska, a partner of NDED, is a private non-profit venture development organization focused on early stage high-impact companies in Nebraska and growing the state’s economy.
“These SSBCI funds allow Nebraska to focus on the development of early stage companies and growth companies in our urban and rural areas,” said Gov. Pete Ricketts. “Collaborating with the state’s banking community and the ongoing private-public partnership with Invest Nebraska will only strengthen Nebraska’s private sector and grow our economy.”
The Nebraska Progress Loan Fund has provided funding for nine new loans totaling $6.84 million, attracting $28,180,275 in private lending, creating 299 new jobs and developing new relationships with Nebraska bankers interested in investing in small businesses located in their communities. Additionally, 15 angel investments totaling $802,000 (as of December 31, 2014) have been made, attracting $988,000 in private investment with follow-on investment totaling $1,154,000 as the companies have started to grow.
The partnership between the Nebraska Progress Loan Fund and community bankers has led to investments in companies engaged in developing or marketing medical devices, industrial tools, special-use storage tanks, energy-saving software, and the manufacture of natural light-weight materials substituted for more expensive resin materials in plastics and other uses, among other products.
SUCCESS IN CHEYENNE COUNTY
The Nebraska Progress Loan fund has been a highly successful initiative. One such success is Adams Industries, based in Cheyenne County in western Nebraska. Adams Industries is a supply chain service company specializing in trucking, warehousing, logistics and trans-loading. With convenient access to I-80, several major highways, and service through both Burlington Northern Santa-Fe and Union Pacific railroads, the company location gives it the ability to serve multiple industries, including oil, natural gas, renewable energy, lumber, agribusiness and others.
Invest Nebraska has also forged a partnership with the early-stage Lincoln-based NMotion Accelerator focused on software- and technology-based businesses in the agriculture, health care, education, finance/insurance, and sports technologies industries. The Accelerator is sponsored by the University of Nebraska-Lincoln.
Additionally, a success growing out of the Nebraska Progress Seed Fund is Ecomitize, a comprehensive e-commerce solution that provides small and mid-size businesses the ability to compete in the online market place. Located in North Platte, Neb., Ecomitize provides the ability to import products, attributes, shipping methods, and order data along with synchronizing inventory and quantity of products sold.
SSBCI was created by the federal Small Business Jobs Act of 2010. Funded with $1.5 billion, the program is expected to spur as much as $15 billion in new private sector lending to small businesses and manufacturers as states use federal funds to leverage private investment dollars. For more information on the Nebraska Progress Loan Fund and Nebraska Progress Seed Fund, visit http://www.neded.org/.
FIVE NEW ENTERPRISE ZONES
The NDED will accept applications for the Nebraska Enterprise Zone Act through July 6, 2015, from Nebraska villages, cities, counties, or tribal government areas interested in having an eligible area within the jurisdiction considered for Enterprise Zone designation.
Enterprise Zones are areas of “economic distress” with relatively high unemployment, poverty, and declining population as prioritized from most to least significant.
The Nebraska Department of Economic Development will designate up to five areas as Enterprise Zones defined as no more than one being located inside the boundaries of the City of Omaha (a metropolitan class city); no more than one being located inside the boundaries of the City of Lincoln (a primary class city); each being located within a single county; each with a population no less than 250; and each with an area measuring between one and 16 square miles.
Applications must include: a description of the geographic location along with a map depicting the proposed zone; a development plan for the proposed Enterprise Zone that includes goals and objectives, and descriptions of current and prospective actions to encourage private investment in the area; a plan outlining available resources to assist residents with self-help development; a description of any projected positive or negative effects of designation as an Enterprise Zone; a plan that assists persons or businesses displaced due to Zone activity; documentation of funding commitments from a city, local political subdivisions, private nongovernmental organizations, or any other non-state government organizations that will directly or indirectly help businesses to locate or expand existing operations within the proposed Enterprise Zone area during its first three years of its existence (if designated an Enterprise Zone by the Department); and documentation all procedural requirements for Enterprise Zone applicants are completed.