OGDEN -- Several institutions have pledged up to $25 million over the next five years to fund loans from a newly formed nonprofit organization to fledgling businesses in the Ogden area.
The Ogden Reinvestment Corporation, formed by local business leaders and housed in the city's Business Information Center at 2036 Lincoln Ave., received nonprofit status in January.
In addition, ORC was certified in March by the U.S. Department of the Treasury as a community development finance institution, which allows it to receive federal funding.
ORC will funnel funds from the federal government, private investors and banks to Ogden-area business owners who are traditionally unbankable, undercapitalized or needing pre-development, microenterprise or bridge loans.
"So many people come in (to the Ogden Community and Economic Development Department seeking financing) that can't get traction and can't get going," said Tom Christopulos, the city's business development manager.
ORC is not controlled by the city, but is operated by a nine-member board of trustees, of which Christopulos is a member. Several trustees also serve on ORC's loan-approval committee.
Scott Parkinson, ORC chairman and senior vice president of retail banking for Ogden-based Bank of Utah, said ORC's mission of giving businesses a helping hand is vital.
"It's really a good example of doing well by doing good. The trick here is finding good projects."
There are no projects currently in the pipeline for funding through ORC, Christopulos said.
ORC is unique because it will broker a variety of loans, said Shawn Beus, an attorney who is ORC's executive director and legal counsel.
ORC has already received loan pledges from banks and organizations to fund business projects.
Bank of Utah and Midvale-based Ally Bank have agreed to loan $2 million annually over five years, Beus said.
GE Capital and GE Money, with offices in Salt Lake County, have agreed to loan $500,000 to $1 million on a year-to-year basis, he said.
In addition, the Ogden Industrial Development Corporation, formed in the 1960s to support local business projects such as establishment of both the Ogden and Weber industrial parks, has pledged $3 million for loans.
Bank of Utah, Ally Bank, GE Capital and GE Money have also contributed $42,500 to cover administrative costs associated with operating ORC, Beus said.
ORC has also applied for a $2 million grant from the federal government for loans and a $100,000 grant for administrative costs.
Christopulos said a decision regarding those grants is expected later this year.
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