Local salsa plant out to get hot
A Lewisburg businessman's production growth is like an example cited by a senior official with an organization managing a $25 million revolving loan fund announced last week by the governor and his economic and community development commissioner.
As such, Brothers Fine Foods would appear to be a likely recipient of "capital resources to maximize statewide impacts for job creation and business expansion," as announced by Gov. Phil Bredesen and Commissioner Matt Kisber with explanations from Hank Helton, senior vice president of Pathway Lending.
The public/private program creates a revolving loan fund so businesses may repay their debt to the fund that makes the money, and the earned interest, available through new loans.
Brothers Fine Foods makes salsa, that saucy condiment of tomatoes and such. The preparation of Matt Harris' recipe grew from a home kitchen to his plant in Lewisburg's industrial park. It's a classic American business story, and one that, with another product, was described by Helton during a telephone interview including Greg Lowe, the city's new industrial developer.
"In Cleveland, Tenn., a woman started making cosmetics in her kitchen," Helton said. "Her business expanded with other products and grew into her grandfather's barn. It then moved to a business incubator and continued to need more room."
That business was too early in its development stages for a bank to take a chance on a loan with her, Helton continued, so she turned to Pathway Lending, a nonprofit organization that helped her expand.
"He almost described Brother's Fine Foods," Lowe said. "They started making salsa in the kitchen."
Pathways' service got a boost last week when Bredesen and Kisber announced the new $25 million Tennessee Small Business Jobs Opportunity Fund that's to offer loans to small businesses throughout Tennessee. It's a public-private collaboration between the state, member banks of the Tennessee Bankers Association and Pathway Lending.
"Small businesses are the backbone of Tennessee's economy," Bredesen said. "Ensuring their success means the state as a whole will thrive... This new ... partnership will support Tennessee's small businesses by providing them with resources they need to grow and create jobs."
Lowe and Helton cautioned that it's too early to predict Brother's participation, but both seemed optimistic that steps should be taken toward making the financing work for the Lewisburg business.
Kisber said the new fund will expand the system used by the Rural Opportunity Fund created in the state's 2010-11 budget with 10 million. It's to be expanded with 10 million in private capital from participating members of the TBA.
One incentive for bankers is the 1979 Credit Reform Act of Congress that addressed an outdated business practice exposed as "red-lining," a boundary around poverty stricken areas in one of America's major metropolitan areas. The Credit Reform Act was passed to cure such an alleged racist practice.
The 30-year-old law has banks earn reinvestment credits. The new Small Business Jobs Opportunity Fund offers a new way for banks to earn credits.
Helton expressed an interest in explaining more details to Marshall County residents and Lowe suggested he find time to visit with the city's Industrial Development Board and the Lewisburg Rotary Club.