Who can help
East Metro resources range from financing to land clean-up
by Liz Wolf
One small-business owner who took advantage of resources available in the east metro is Ge Lee, owner of Today’s Fashion at the corner of University and Western avenues in St. Paul. His store’s $450,000 expansion is expected to add more jobs in the Midway area.
Lee grew through the Small Business Expansion Program, launched in April, which marries public bodies with private capital to provide economic assistance.
The city of St. Paul backs the program because “we don’t really have any choice,” says Randy Kelly, mayor of St. Paul, as cities lose millions of dollars in state aid. “The only option is to expand our tax base and grow jobs in the city. We are pursuing that goal like a heat-seeking missile.”
Partners in this initial pilot project include the Community Reinvestment Fund, St. Anthony Park Bank, St. Paul Port Authority, the city’s Planning and Economic Development Department and The Saint Paul Foundation.
The program uses a secondary source of capital through the Community Reinvestment Fund (CRI) to leverage up to $24 million with a $500,000 investment each from the city of St. Paul and the St. Paul Port Authority.
For the Lee project, the city put up $7,500 for a year. Then CRI will purchase the loans to sell on the secondary market. Kelly calls the risk to the city relatively minor: “The greatest risk we have is to sit back and not do anything and have the city go backwards.”
Rick Beeson, president of St. Anthony Park Bank in St. Paul, calls the program a “powerful and flexible tool for community banks to have in their toolbox.”
Not only for St. Paul
As the heart of the east metro business community, many St. Paul-based organizations take pride in working with local businesses in Ramsey, Washington and Dakota counties. The biggest misconception, say many organization leaders, is that because these services are based in St. Paul, only St. Paul-based businesses can access their services.
Another organization that reaches more than its name might imply is WomenVenture in St. Paul. “We encourage men, women and business owners of all kinds to use our services,” says Gayle Mickey, business development director.
WomenVenture provides everything from startup assistance, loan programs, continuing education classes, ongoing technical and emotional support and mentors. Perhaps its best tool for small-business owners is a database of more than 300 volunteers — lawyers, bankers, business owners, accountants — who are willing to assist WomenVenture clients.
The biggest and most widely known resource in the east metro is the St. Paul Chamber of Commerce. The 2,100-member organization is the largest regional chamber in the state, and is well-connected to the business community of Ramsey, Washington and Dakota counties.
“Our goal is economic development, and we have the resources to help small-business owners with virtually anything they need to help them grow,” says Ellen Waters, senior vice president of economic development.
One program the chamber offers is the Small Business Connections Program, dubbed the “one-stop shop when faced with a business challenge.” The Connections program is supported by chamber members involved in finance, human resources, benefits, legal, risk management, technology, marketing, advertising, real estate, banking, accounting, strategic planning and more.
The only requirement to get help through this program is that the person or business asking the question is a member of the St. Paul Chamber, and the services are free.
Looking for land?
The St. Paul Port Authority provides businesses with cleaner land on which to expand, space on the Mississippi River to receive and ship commodities efficiently, loans for real estate and equipment purchases, and job training and career development for workers.
The organization has helped develop 16 St. Paul-based manufacturing businesses on land that was abandoned and polluted, and since 1996 has helped create or retain more than 17,500 jobs in St. Paul that pay a minimum of $9 per hour plus benefits. The average salary in the manufacturing centers the Port Authority has worked with is $15.60 per hour, plus benefits.
The Port Authority Board of Commissioners requires 2.5 new or retained jobs for every 1,000 square feet of new space it helps create. The Port Authority sells its cleaned up land to a company for only $1.
“We clean up areas no one else wants, or that no one else thinks is feasible for business,” says Tom Collins, public relations director for the Port Authority. “But we also take a lot of pride in providing and creating jobs.”
One business that has taken advantage of the programs offered through the Port Authority is St. Paul-based Summit Brewing Co.
“I think it’s a great resource for businesses, and I know it played a part in us locating there,” says Mark Stutrud, president and founder of Summit Brewing.
The Minnesota Hmong Chamber of Commerce honored The Port Authority with its 2002 Leadership Award, due in part to the ongoing work of the Port Authority in helping find space for a new Hmong funeral home in St. Paul.
“Through our growing pains, the Port always was there and willing to help financially and with its staff,” says J. Kou Vang, president of the chamber.
The St. Paul Port Authority, The St. Paul Chamber of Commerce and the Midway Chamber of Commerce have partnered to develop a program called Employer Solutions Inc. (ESI). ESI provides a wide range of workforce resources to help owners with recruitment, talent, management and organizational effectiveness, from cultural competence development, customized skill training and employee retention. ESI works with clients all over the east metro.
“We do an extensive amount of business in the east metro, and we welcome the chance to work with those who feel we would be a good fit,” says Janet Ludden, CEO of ESI.
The Neighborhood Development Center (NDC) is a St. Paul-based non-profit organization that assists about 120 fledgling low-income, minority business owners through a 16-week business startup class, ongoing technical and consulting services once business gets started, and the ability to work with different cultures in five languages: English, Spanish, Hmong, Somali, and Oramo.
Since 1993 the NDC has trained more than 380 small-business owners, creating 1,400 jobs and a combined payroll of $21 million. By using the services of the Neighborhood Development Center, business owners agree to keep their company in the St. Paul community where it originally was headquartered.
Among its projects are the Plaza Latina, a retail center with 10 businesses in the Payne Avenue neighborhood, numerous retailers on the west side, and a business incubator at University and Dale that is home to 20 businesses.
“These energetic entrepreneurs also pay taxes and rent, buy supplies, provide needed products and services, and serve as visible role models in their communities,” says Mike Temali, executive director and author of The Community Development Handbook, the step-by-step guide to turning any neighborhood around.
Promoting growth
The St. Paul/Metro East Development Corp. (SPEDCO) is a New Brighton-based private, non-profit company whose purpose is to promote and assist in the growth and development of small businesses located within Ramsey, Washington, and Dakota counties.
SPEDCO has been certified by the U.S. Small Business Administration (SBA) to provide long-term, fixed rate loans for the purchase or construction of fixed assets through the SBA’s 504 Loan Program.
As a registered agent of the SBA since 1981, SPEDCO’s function is to market the 504 loan program, pre-screen potential loan applicants, and service all loans that receive funding from the government. Since its inception more than 250 loans processed by SPEDCO have received SBA approval in the aggregate amount of $63 million. As of December 31, 2002, more than 5,210 jobs had been created or retained due to these loans.
Some small businesses that have worked with SPEDCO include Nor-Lakes Service Midwest Inc. in Hugo, Navy Island Plywood in West St. Paul, Westbrook Development and Construction in Woodbury, and Diversified Manufacturing Corp. in Newport.
“The east metro is a great place to expand your business,” says Kristin Wood, executive director of SPEDCO. “The price of land is cheaper, and the work force is proven and capable. There is a lot of opportunity for small businesses to succeed.”
Another resource for small-business owners is the Metro East Development Partnership (MEDP). Don’t be fooled by its Minneapolis location and phone number. This non-profit organization provides businesses with a comprehensive evaluation of various regional communities, industrial and commercial sites, buildings and business opportunities. MEDP also provides entrepreneurs and businesses with access to demographic, market and labor information.
“There are a lot of resources in the east metro,” says WomenVenture’s Mickey. “I encourage business owners to open up to as many organizations as possible. We are all here to help, and provide services that can benefit your business in the long run.”
