Q.  I am working with a business that needs an addition, and the bank's credit policies will not allow us to lend the full amount of capital needed to complete the project. Is there another source of funding available?

A.   FAME has at least two resources for subordinate financing/gap financing to meet your full project costs. Our Economic Recovery Loan Program can provide subordinate funds to fill gaps in a project proposal. However, a much less known but very relevant source of financial assistance is available through an economic development agency serving your area, participating through a FAME program called the Regional Economic Development Revolving Loan Program.  Under this program, FAME disseminates funds  throughout the state to each of these agencies.This provides the agencies with a source of gap or subordinate financing to fill a business' full project need. Over the past 15 years, this program has enabled the 23 agencies to provide over $32 million in loans, and leveraged an additional $242 million. 

Please see the Featured Commercial Division Program for more information and a listing of agency participants.

This program was created in 1993 and initially funded in 1995 through a $10 million voter-approved general obligation bond.  The program was subsequently re-capitalized with bond proceeds in 2002 of $4 million and in 2007 with $1 million.

The purpose of the program is to provide financial assistance in the form of loans of up to $250,000 to businesses in order to create or retain jobs. It is targeted to businesses that have sales under $5 million or employ 50 or fewer people. Loans under this program tend to provide the gap financing and/or subordinate financing businesses may need in order to complete their projects. The program targets businesses that meet at least one of the following targeted economic development clusters: 

•  Manufacturing Technologies;
• Technologies such as advanced information systems, advanced telecommunications, energy and environmental products and services;
• Biological and natural resource technologies;
• Conversion from defense dependency;
• A business significantly engaged in export or goods/services to locations outside the state;
• A business that dedicates significant resources to research and development;
• Other businesses with 10 or fewer employees; or
• A quality child care project.

Note:  There are match funding provisions required for loans of $50,000 or more.

The Finance Authority of Maine administers the program on behalf of participating economic development agencies, who in turn use funds allocated to them to provide financial assistance to businesses located throughout the state.The current number of agencies that have REDRLP funds is 23 and they are:

·         Androscoggin Valley Council of Governments  (207) 783-9186

·         Bangor Airport Civic Development Corp.  (207) 735-4059

·         Biddeford/Saco Area Economic Development Corp.  (207) 282-1748

·         Caribou Chamber of Commerce & Industry (207) 498-6156

·         City of Portland  (207) 874-8683

·         City of Presque isle  (207) 764-2503

·         Coastal Enterprises, Inc.  (207) 882-7552

·         Community Concepts Finance Corporation  (207) 743-7716

·         Eastern Maine Development Corporation  (207) 942-6389

·         Greater Portland Council of Governments  (207) 774-9891

·         Katahdin Regional Development Corporation (EMDC)  (207) 942-6389

·         Kennebec Valley Council of Governments  (207) 453-4258

·         Lewiston/Auburn Economic Growth Council  (207) 784-0161

·         Limestone Development Foundation (NMDC)  (207)  498-8736

·         Midcoast Council of Governments  (207) 443-5790

·         Northern Maine Development Commission  (207) 498-8736

·         Washington-Hancock Community Agency  (207) 546-7544

·         Penquis Community Action Program (MaineStream)   (207) 973-3500

·         River Valley Growth Council  (207) 369-0396

·         Sunrise County Economic Council  (207) 255-0983

·         Town of Fort Kent   (207) 834-3507

·         Town of Lisbon  (207) 783-9186

·         Town of Lubec  (207) 733-2341

Program Performance:   As of 12/31/2009, a statistical review and collection of data was made in order to determine the level of activity and success of the program.   A review of dollars lent, dollars leveraged, jobs created and jobs retained over the 15 year program history was undertaken, yielding the following impressive results:

Table I - Dollars Lent and Leveraged: