When the state of Kansas pulled its funding from the state Main Street Program in October 2012, most communities in the program were still in control of state funds they had been using for years to make interest free loans to qualifying local businesses.
The program, which began back in the early to mid-1990s, was called “Incentives Without Walls.” For several years, Kansas Main Street communities could apply to the state for up to $10,000 annually to use for grants, low interest, or no interest loans to local businesses.
Before long, the department of commerce decided not to fund grants to individual businesses and to use the money to make loans instead. As the loans were paid back, the money would go back into the IWW account for the individual community to use again.
Peabody Main Street businesses applied for, and received, $27,000 during the time the department of commerce was funding the program. Eventually the funding stream dried up, but each community kept its IWW money to continue making loans.
When the state discontinued the Main Street program, the communities with IWW funds were allowed to keep them.
With more than half of the IWW money on loan, PMSA still has about $10,000 available for loan to any business in the community, not including home-based businesses.
The money can be used for physical improvements, business expansions, and “startups.” A startup business will be required to fill out a business plan.
Loans are made on a one-to-one basis. The business owner must contribute $1 of his own money for each dollar borrowed from Main Street, interest free for up to seven years.
A payment plan is negotiated between the business owner and Peabody Main Street.
“Quite a few downtown business owners have taken advantage of the funds,” Peabody Main Street director Shane Marler said. “The IWW money used to be limited for use to those businesses in the historic district, but once the state program ended, the department of commerce said businesses in other parts of our communities were also eligible for loans.”
As loans are re-paid, the balance in the loan pool grows.
“Some people pay monthly and some spread it out a bit more,” Marler said. “We work with the business owner to keep the payments within reason.”
Marler also said that even though there is no longer a Kansas Main Street program overseeing the loans, PMSA sends reports to the department of commerce about the IWW money.
“They want to be sure that it not only is being paid back, but that we are loaning it out and making it work for the business community,” he said.
Loans are available to any eligible Peabody business. To find out more about the application process, contact Peabody Main Street c/o of Marler at (620) 947-2356 or Kelly Penner at (620) 983-9023.