Community Development Loan Program

 If you have an existing or start-up business in Bowdoinham, are in need of a loan to help your business thrive,  and meet the criteria below, please contact us to explore the possibility of a low-interest flexible-term loan!

(BCDI has recently completed two new Community Development Loans, bringing the total loaned through this Neighbors-Investing-in-Neighbors program to over $89,000 – Thank you Bowdoinham!)

One aspect of BCDI is a loan fund linking small enterprises in Bowdoinham to neighbors who are willing and ready to invest in a local undertaking that will benefit the individual and the community. The focus is on farms, food, forests, the music and art that accompany them and the businesses that support those sectors. The proposed loans are very low interest with flexible repayment terms tailored to meet the specific needs and capacities of the beneficiary. The amount of a BCDI Loan may be a minimum of $500 and maximum of $15,000. The repayment of the loan is expected within 12 months of disbursement, with a maximum repayment time of 24 months. (These terms may be adjusted as the fund matures).

BCDI  has found that a number of town residents are interested in participating in the fund. The approval of an application by the BCDI Board, after vetting the request through a screening committee, will trigger a solicitation of the required funds from Members of BCDI who are potential investors, the receipt, disbursement, collection and accounting of those funds, as well as the distribution of repayments and accrued interest. Twelve loans have been made so far, with several new loans currently in the pipeline. All loans due have been fully repaid.

How to Apply for a Loan

A loan application consists of the following:

1. A narrative that includes a description of the entity requesting the loan, the purpose of the loan, the anticipated time and modalities requested to repay the loan, how the loan will benefit the enterprise and the community.

2. Evidence of collateralization for the loan.

3. Evidence of the capacity of the entity to repay the loan in the proposed timeframe.

The Screening Committee may require supplementary documentation for final loan approval.

Criteria for approval of a loan application by the Screening Committee

1. The loan appears to be needed.

2. The loan will allow the applicant to undertake activities that will benefit the community as well as the applicant.

3. There is sufficient evidence that the loan applicant will be able to repay the principle and interest of the loan in the proposed timeframe. (These conditions will be established by the Screening Committee  in consultation with the applicant.)

4. The standard interest rate will be set at 3%: 2% will be the return to the investor;  1% will be retained by BCDI to help cover operational costs. BCDI may consider additional/alternative “interest” on the loan in terms of benefit to the community that flows directly from implementation of activities supported by the loan.  (These conditions will be established by BCDI in consultation with the applicant.) The BCDI Board will also require a fee of not more than $50 for managing the loan process.

5. The collateral offered by the applicant is acceptable.

6. Due diligence by the Steering Committee has established sufficient documentation to support the bona fides of the application.

7. The applicant is a Member of BCDI.

If you have a business in Bowdoinham and are interested in the loan program, please contact BCDI.

Posted in Programs & Projects

Apple Creek Farm Pays Loan

 

THIS LOAN HAS BEEN FULLY FUNDED AND REPAID IN FULL 3 MONTHS AHEAD OF THE DUE DATE!!

The BCDI Loan Fund is seeking investment shares ($250 per share) to provide $7000 to a young farmer operating an organic farm in Bowdoinham to proceed with the expansion of his sheep raising operation through installing fixed sheep fencing. Most of the costs of the fencing will be reimbursed through a grant from USDA which has already been approved but that can only be disbursed on completion of the work according to USDA specifications.

The Background
BCDI is continuing to mobilize local resources to help the community build on the wonderful assets that exist already – a burgeoning group of young farmers committed to sustainable agriculture, a vibrant arts scene, a long history of an eclectic population tempered by a strong sense of community, a location on Merrymeeting Bay midway between four key Maine cities – to make Bowdoinham an even better place to live and work. BCDI aims to stimulate, grow and sustain healthy local enterprises, create resilient local jobs, and facilitate collaboration among the for-profit, non-profit, and government sectors in the local community. BCDI’s focus is on farms, food, forests, the music, the art and the artisans that accompany them and the local businesses that support them.

BCDI’s main undertaking has been the establishment of a lending mechanism to meet local needs with local capital. The idea emerged when discussing the real needs of some of the young people in town as well as the need to bring back a “credit union of the old school” (small, focused on the serving needs of the local community, with no ambition to expand.) The fund’s first investment opportunities have provided $19,000 to support expanding organic produce farmers in Bowdoinham. Loan applications have been processed from receipt to disbursement (including the necessary due diligence and vetting of the application and raising the required capital) in approximately three weeks. The first two loans were paid back in full and ahead of their dates due.

The Application
Apple Creek Farm is a diversified livestock farm established in Bowdoinham in 1985. Jake and Pete Galle currently manage the farm with a long-term goal of Jake and his partner Abby Sadauckas transitioning into full-time operators. Pete and his wife Janet began raising sheep over 40 years ago, 30 of those years have been in Bowdoinham. In the early 2000’s they integrated beef cows in to the operation. This farm produces grass fed beef and lamb products that are directly marketed to consumers. As the animal numbers have grown the need for more pasture has grown as well. The method of rotational grazing is used to reduce stress on pastures, cut down on parasite problems, divide fertility equally across the pastures, and provide the animals with grasses and legumes in quality stages of growth.

In 2009, Apple Creek Farm began leasing a pasture at 1318 River Road. The addition of this pasture allowed the home fields to have a lower carrying capacity of animals to acreage percentage. For the past four years the lambs transported to this pasture have been rotationally grazed using temporary electric fencing. In 2012 a three-year contract between NRCS-Natural Resource Conservation Services (USDA) and Apple Creek Farm was signed. This contract is for multiple improvements to the leased pasture at 1318 River Road. In the second year of the contract NRCS is providing funds for permanent fencing, pasture forage reseeding, and several other projects to be completed in 2013. The funds are provided after the projects have been completed and signed off on by our NRCS agent. Apple Creek Farm requests a loan amount of $7000 in order to help fund the upfront costs of fence materials and installation, and for partial seed purchases. The amount of the loan can be repaid in full before the end of 2013. The permanent fencing will allow for greater number of animals to graze at this pasture with better protection from predators. Luckily to date, no lambs have been lost or killed while at this pasture. The permanent fencing will also allow for yearling beef cattle to graze at this site – creating a needed security that temporary fencing cannot provide. The more animals that can be finished on pasture at this site means more local meat available to local consumers and with greater consistency. With help from BCDI and community members, this project may entice others to consider leasing land – providing opportunity for landowners with open space to remain open and become productive once again.

The Investment
The BCDI Loan Fund is seeking investment shares ($250 per share) to provide $7000 to proceed with the construction of the approved fencing. The loan will be repaid in full by 31 December 2013 and you will receive your initial investment plus interest at a rate of 2% for the life of the loan. For example, if you invest $500 you will receive $510 before the end of the year – better in fact than you might get on a CD at the bank – plus you will be supporting a local farmer who provides wonderful healthy food to the community (including at the Bowdoinham Farmers’ Market) and to the economy of the community. BCDI will charge 3% interest on the loan to the farmer, plus an administrative fee of $50.

The Risks
All investment has risk. In this case the risks are relatively small. In the interest of transparency and a further word of caution, however, note that BCDI is not a bank and the criteria applied in considering this loan are more personal and less rigid than might be applied by a bank. This process is locally focused – the individuals are personally known, and the screening committee’s examination of the application has been conducted in the spirit of neighbors seeking to find ways to help neighbors, and by doing so strengthen the community itself.
That said, the application process has been rigorous: the application review was done by a Screening Committee ( Kathy Gallant, Kathy Montejo, Steve Bunn, David Engler and Jack Beaudoin) with broad and varied business, banking, farming, management experience; it examined the application thoroughly and did due diligence on the request. While this may on the one hand simplify the procedure, it does imply a certain amount of good faith. In the opinion of the committee that reviewed this application, however, the risks are within tolerance, and the loan was recommended for approval, and the BCDI Board concurred. If for any reason the loan does not go forward and the funds are not disbursed, your investment, which will be held pending disbursement in a BCDI account at Norway Savings Bank, will be returned in full.

The Rewards
1. You will be making an investment that you can see, and in a neighbor you know.
2. You will be supporting the further development of the healthy food practices in Bowdoinham.
3. You will be helping expand local employment.
4. You will be helping advance the creation of a local community support mechanism (BCDI) and
5. You will be helping facilitate access to an important USDA-NRCS program

The Next Step
There are a several ways to respond to this initiative, but we do hope that you will respond, even if it is to say “no thanks”.

1. Yes, I would like to invest in the BCDI loan fund for this fencing project with an investment of $________ (multiples of $250)
2. I like this concept, but prefer not to invest at this time. Please keep me on the list and informed of other investment opportunities as they arise.
3. I am not interested in investing in this way, but please keep me informed about the evolution of BCDI and its engagement in the Bowdoinham Community.
4. I am not interested in this initiative. Please remove me from the list of future recipients.

If you know other Bowdoinham community members who you think might be interested in making this kind of investment, please share this with them or have them visit our website: www.bcdi.us

BCDI
182 Ridge Road
Bowdoinham, ME 04008
Telephone: 522 4118
Email: david.whittlesey@gmail.com

Thanks for taking the time to consider this opportunity to engage in the Community of Bowdoinham.

Posted in Programs & Projects

Bob Kane Wood Products

THIS LOAN HAS BEEN FULLY FUNDED AND REPAID IN FULL

New Investment Opportunity – Bob Kane Wood Products

The BCDI Loan Fund is seeking investment shares ($100 per share) to provide $1850 to support a new aspect of Bob Kane’s enterprise. Bob has all the pieces in place to launch a small wood milling operation, to compliment his firewood business on his property on the Post Road. He has the equipment in place, including a brand new WoodMizer L35 Hydraulic portable mill, but requires some critical repairs to his truck and some replacement saw blades for the operation to launch. Bob has exhausted his cash reserve getting to this point, and is seeking a loan of $1850 to successfully get started.

The Background

BCDI is continuing to mobilize local resources to help the community build on the wonderful assets that exist already – a burgeoning group of young farmers committed to sustainable agriculture, a vibrant arts scene, a long history of an eclectic population tempered by a strong sense of community, a location on Merrymeeting Bay midway between four key Maine cities – to make Bowdoinham an even better place to live and work. BCDI aims to stimulate, grow and sustain healthy local enterprises, create resilient local jobs, and facilitate collaboration among the for-profit, non-profit, and government sectors in the local community. BCDI’s focus is on farms, food, forests, the music, the art and the artisans that accompany them and the local businesses that support them.

BCDI’s main undertaking has been the establishment of a lending mechanism to meet local needs with local capital. The idea emerged when discussing the real needs of some of the young people in town as well as the need to bring back a “credit union of the old school” (small, focused on the serving needs of the local community, with no ambition to expand.) The fund’s first investment opportunities have provided $19,000 to support expanding organic produce farmers in Bowdoinham. Loan applications have been processed from receipt to disbursement (including the necessary due diligence and vetting of the application and raising the required capital) in approximately three weeks. The first two loans were paid back in full and ahead of their dates due.

The loan request from Bob Kane Wood Products is inherently a greater risk than previous loans funded through the BCDI process. Both the Screening Committee and the board felt strongly that the risk was worth taking, while making sure that potential investors are fully aware. The business that the loan will support is very much within the Bowdoinham tradition, and the purview of BCDI’s mission. To ensure its viability, the SC recommended and the Board approved that the amount of the initial request be increased so that the business model would not be undermined by lack of capitalization. The balance of the loan ($600) beyond what is needed for the stated purpose ($1250) will be held in the BCDI Investment account in Bob Kane Wood Products name to be used if and as needed to establish the positive cash flow anticipated for the business to be sustained.

The Application

Bob is a long time Bowdoinham resident who very much embodies the Maine spirit of both “getting by” and “sharing the bounty”. He lives simply, off the grid, and is proud to be an independent businessman. He owns his house and land (82 acres) outright, and the woodlot is relatively mature mixed hard and soft wood that has been only selectively harvested since the mid-‘50’s. Over the past few years, his income has come from selling firewood, and cashing in previous investments (CD’s) that he planned to take him to “retirement”, Social Security.

In 2012, Bob purchased a “WoodMizer” LT35 hydraulic portable saw aiming to move into value added harvesting of his woodlot. He has a note with Norway savings on the WoodMizer but owns outright a relatively new Kubota tractor, chain saws, splitter etc for the firewood side of his business. The purchase of the machine, plus the depletion of his liquid assets left him with no cash reserve as he works to establish this new aspect of his business. He is now confronted with repair issues on his truck (1995 GMC 1-ton dump) and the need for additional blades (hard wood) for his saw. Having the truck running is essential to him being able to make his business work. Bob is seeking a loan of $1000 to repair his truck (fuel system – computer and lines) and $250 for hardwood blades. As mentioned above, BCDI recommended to Bob and he concurs, that a cash reserve during this start-up period will be essential, and has included an amount ($600) to be held for that purpose.

The Investment

The BCDI Loan Fund is seeking investment shares ($100 per share) to provide $1850 to Bob Kane Wood Products to make the necessary repairs to his truck and to buy the required hardwood blades for the WoodMizer. The loan will be repaid in full by 18 months from the time of disbursement when the investment plus accrued interest would be paid out to investors. You will receive your initial investment plus interest at a rate of 2% for the life of the loan. For example, if you invest $100 you will receive $102 at the loan’s repayment plus you will be supporting a local enterprise that is providing locally custom cut wood products (boards, furniture quality planks, table tops) to the community and contributing to the economy of the community. BCDI will charge 3% interest on the loan, plus an administrative fee of $18.50 The additional 1% and the service fee may be paid in kind.

The Risks

All investment has risk. In this case the risks are numerous, which is one reason why a commercial loan is not feasible. Bob’s new enterprise is heavily invested in machinery, with no excess reserve and not much of a track record except his solid character. Bob is no youngster, just entering eligibility for Social Security, and the work that he will be doing is demanding. While he has a number of jobs lined up, they are verbal agreements not contracts. The weather may disrupt work. The loan would be collateralized by an outboard motor, the value of which is only an estimate and be subject to sale. There may be other potential impediments to successful implementation that are not immediately apparent. In the interest of transparency and a further word of caution, note that BCDI is not a bank, and the criteria applied in considering this loan are more personal and less rigid than might be applied by a bank. This process is locally focused – the individuals are personally known, and the screening committee’s examination of the application has been conducted in the spirit of neighbors seeking to find ways to help neighbors, and by doing so strengthen the community itself.

That said, the application process has been rigorous: the Screening Committee (Kathy Gallant, Kathy Montejo, Jack Beaudoin, David Engler and Steve Bunn) and the Board has broad and varied business, banking, farming, management experience; it examined the application thoroughly and did due diligence on the request and it fully documented the process as it was carried out. The committees that reviewed this application noted the risks and approved the loan. If for any reason the loan does not go forward and the funds are not disbursed, your investment, which will be held pending disbursement in a BCDI account at Norway Savings Bank, will be returned in full. Both Committees further agreed to “spread the word” of Bob Kane’s Wood Products and encourage neighbors in need of wood to use its services.

The Rewards

1. You will be making an investment that you can see, and even participate in, and in a neighbor you know.
2. You will be supporting the further development of a healthy enterprise taking advantage of Bowdoinham’s natural resources.
3. You will be helping support local employment.
4. You will be helping advance the creation of a local community support mechanism (BCDI)

The Next Step

There are a several ways to respond to this initiative, but we do hope that you will respond, even if it is to say “no thanks”. You can do this by phone, email or mail.

1. Yes, I would like to invest in the BCDI loan fund for Bob Kane Wood Products with an investment of $100.
2. I like this concept, but prefer not to invest at this time. Please keep me on the list and informed of other investment opportunities as they arise.
3. I am not interested in investing in this way, but please keep me informed about the evolution of BCDI and its engagement in the Bowdoinham Community.
4. I am not interested in this initiative. Please remove me from the list of future recipients.

(If you would like to become a member of BCDI both to help support the organization and participate in shaping its future, please visit our website at http://www.bcdi.us)

Thanks for taking the time to consider this opportunity to engage in the Community of Bowdoinham. If you know other Bowdoinham community members who you think might be interested in making this kind of investment, please share this with them or give them this contact information:

BCDI
182 Ridge Road
Bowdoinham, ME 04008
Tel: (207) 522 4118 Email: david.whittlesey@gmail.com Website: http://www.bcdi.us

Thanks!

Posted in Programs & Projects

Long Branch School

THIS LOAN HAS BEEN FULLY FUNDED

A New Investment Opportunity

The BCDI Loan Fund is seeking investment shares ($250 per share) to provide $5740 to support two projects at the Long Branch School. The funds are being sought to purchase the materials and preparation for two courses: a timber framing work shop that includes the building of a small multi-purpose building; and an outdoor wood-fired oven work shop. The courses, which are important parts of the Long Branch summer program, will be taught by local artisans and result in structures that will both serve as collateral and become tangible assets for the School and the Community    

 The Background

BCDI is continuing to mobilize local resources to help the community build on the wonderful assets that exist already – a burgeoning group of young farmers committed to sustainable agriculture, a vibrant arts scene, a long history of an eclectic population tempered by a strong sense of community, a location on Merrymeeting Bay midway between four key Maine cities – to make Bowdoinham an even better place to live and work.  BCDI aims to stimulate, grow and sustain healthy local enterprises, create resilient local jobs, and facilitate collaboration among the for-profit, non-profit, and government sectors in the local community. BCDI’s focus is on farms, food, forests, the music, the art and the artisans that accompany them and the local businesses that support them.

BCDI’s main undertaking has been the establishment of a lending mechanism to meet local needs with local capital.  The idea emerged when discussing the real needs of some of the young people in town as well as the need to bring back a “credit union of the old school” (small, focused on the serving needs of the local community, with no ambition to expand.) The fund’s first investment opportunities have provided $19,000 to support expanding organic produce farmers in Bowdoinham. Loan applications have been processed from receipt to disbursement (including the necessary due diligence and vetting of the application and raising the required capital) in approximately three weeks. The first two loans were paid back in full and ahead of their dates due.

Long Branch School and General Store shares many of these same goals, and as a private undertaking in the center of Bowdoinham village, anchors a revitalization of our main street. The request for a loan from Long Branch School, the first outside of the agricultural domain, has been vetted and approved and your investment is needed to make it real.

The Application

The Long Branch School and General Store opened in the fall of 2011 on Main Street in the in the heart of the village in Bowdoinham.    The first element of Long Branch’s business is to provide workshops, classes, and unique experiences using local craftsmen focused on self-reliance and sustainability.  The second element of the business is a retail operation that offers local food and crafts in both a storefront and an on-line buying club.

The summer curriculum for the Long Branch school is presently under development, and they are striving to get the main workshop facility (“the old fire station”) to a point of being operational by mid-spring. They have already put a considerable amount of capital into rehabilitation of the former Credit Union building, waste management improvements, and the structure of the business. The loan application to BCDI is to cover the upfront materials and preparation expenses associated with two workshop programs: 1) a Timber Framing Workshop; and 2)  an Outdoor Wood-fired Oven Workshop.  The timber framing project requests a total of eighteen hundred dollars ($1800) and the outdoor mobile wood-fired oven project requests a total of three thousand nine hundred forty dollars ($3940).While each proposal has its own capital requirements, for purposes of simplifying the loan arrangement the two have been aggregated into one request.    The grand total of the requirements for the two projects together is five thousand seven hundred forty dollars ($5740).

 The Investment

The BCDI Loan Fund is seeking investment shares ($250 per share) to provide $5740 to Long Branch School to purchase the materials and cover the cost of preparation for the two courses as mentioned. For the Timber-Framing Course, the funds ($1800) would cover the cost of hemlock timbers and oak pegs, and the cost of initial preparations to allow the structure to be completed in the two-day course itself. For the Wood-fired Oven the funds ($3940) would cover the cost of procuring a pre-owned tandem axle trailer, materials and associated cost of installation to support the oven and materials for the oven itself.  The loan will be repaid in full by 18 months from the time of disbursement when the investment plus accrued interest would be paid out to investors. Long Branch will pay back the loan in three tranches at 6, 12 and 18 months. You will receive your initial investment plus interest at a rate of 2% for the life of the loan. For example, if you invest $250 you will receive $255 at the loan’s repayment plus you will be supporting a local enterprise that is providing wonderful healthy local products to the community and contributing to the economy of the community. BCDI will charge 3% interest on the loan to Long Branch, plus an administrative fee of $50.

The Risks 

All investment has risk. In this case the risks are numerous, which is one reason why a commercial loan would demand a considerable interest rate. Long Branch School is a new enterprise, heavily invested in a small town, with little excess reserve and not much of a track record.  Participation in the classes that are offered has at times been less than planned. The weather may disrupt classes (though both of these classes could be largely carried out inside the new fire station workshop). The timber frame structure and the finished oven might not be valued by the market at full value meaning the loans would be less than fully collateralized. There may be other potential impediments to successful implementation that are not immediately apparent.  In the interest of transparency and a further word of caution, note that BCDI is not a bank, and the criteria applied in considering this loan are more personal and less rigid than might be applied by a bank. This process is locally focused – the individuals are personally known, and the screening committee’s examination of the application has been conducted in the spirit of neighbors seeking to find ways to help neighbors, and by doing so strengthen the community itself.

 

That said, the application process has been rigorous: the Screening Committee (Pete Galle, Kathy Gallant, Kathy Montejo, Jack Beaudoin and David Whittlesey) and the Board (Tony Cox recused himself from the decision) has broad and varied business, banking, farming, management experience; it examined the application thoroughly and did due diligence on the request and it fully documented the process as it was carried out. The two products that are built will serve as collateral for the loan. In the opinion of the committees that reviewed this application, the risks are within tolerance, and the loan approved. If for any reason the loan does not go forward and the funds are not disbursed, your investment, which will be held pending disbursement in a BCDI account at Norway Savings Bank, will be returned in full.

The Rewards   

1.            You will be making an investment that you can see, and even participate in, and in a neighbor you know.

2.            You will be supporting the further development of a healthy enterprise in the heart of Bowdoinham village.

3.            You will be helping support local employment.

4.            You will be helping advance the creation of a local community support mechanism (BCDI)

The Next Step  

There are a several ways to respond to this initiative, but we do hope that you will respond, even if it is to say “no thanks”. You can do this by phone, email or mail.

1.            Yes, I would like to invest in the BCDI loan fund for Long Branch School with an investment of $________ (multiples of $250)

2.            I like this concept, but prefer not to invest at this time. Please keep me on the list and informed of other investment opportunities as they arise.

3.            I am not interested in investing in this way, but please keep me informed about the evolution of BCDI and its engagement in the Bowdoinham Community.

4.            I am not interested in this initiative. Please remove me from the list of future recipients.

(If you would like to become a member of BCDI both to help support the organization and participate in shaping its future, please go to the Membership page.)

Thanks for taking the time to consider this opportunity to engage in the Community of Bowdoinham. If you know other Bowdoinham community members who you think might be interested in making this kind of investment, please share this with them or give them this contact information:

 BCDI

182 Ridge Road

Bowdoinham, ME 04008

Tel:  (207) 522 4118               Email: david.whittlesey@gmail.com                   Website: http://www.bcdi.us

 Thanks!

 

Posted in Assorted/Archived, Programs & Projects

Loan/Investment Program

One aspect of BCDI is a loan fund linking small enterprises in Bowdoinham to neighbors who are willing and ready to invest in a local undertaking that will benefit the individual and the community. The focus is on farms, food, forests, the music and art that accompany them and the businesses that support those sectors. The proposed loans are very low interest with flexible repayment terms tailored to meet the specific needs and capacities of the beneficiary. The amount of a BCDI Loan may be a minimum of $500 and maximum of $15,000. The repayment of the loan is expected within 12 months of disbursement, with a maximum repayment time of 24 months. (These terms may be adjusted as the fund matures).

BCDI  has found that a number of town residents are interested in participating in the fund. The approval of an application by the BCDI Board, after vetting the request through a screening committee, will trigger a solicitation of the required funds from potential investors, the receipt, disbursement, collection and accounting of those funds, as well as the distribution of repayments and accrued interest. Three loans have been made so far: one to Small Wonder Organics to purchase a tractor; one to Life Force Farm to build a high tunnel greenhouse; and a third  to Left Field Farm to purchase two greenhouses. The Small Wonder Organics loan was repaid a full three months in advance, and over half of the investors requested that their investment be “rolled-over” to fund new opportunities. The result has been that after the disbursement of the most recent loan, there remains a positive balance in the investment account. These funds will be used to fund future loan/investment opportunities, with the approval of the individual investors (see News for details)

How to Apply for a Loan

A loan application consists of the following:

1. A narrative that includes a description of the entity requesting the loan, the purpose of the loan, the anticipated time and modalities requested to repay the loan, how the loan will benefit the enterprise and the community.

2. Evidence of collateralization for the loan.

3. Evidence of the capacity of the entity to repay the loan in the proposed timeframe.

The Screening Committee may require supplementary documentation for final loan approval.

Criteria for approval of a loan application by the Screening Committee

1. The loan appears to be needed.

2. The loan will allow the applicant to undertake activities that will benefit the community as well as the applicant.

3. There is sufficient evidence that the loan applicant will be able to repay the principle and interest of the loan in the proposed timeframe. (These conditions will be established by the Screening Committee  in consultation with the applicant.)

4. The standard interest rate will be set at 3%: 2% will be the return to the investor;  1% will be retained by BCDI to help cover operational costs. BCDI may consider additional/alternative “interest” on the loan in terms of benefit to the community that flows directly from implementation of activities supported by the loan.  (These conditions will be established by BCDI in consultation with the applicant.) The BCDI Board will also require a fee of not more than $50 for managing the loan process look at more info.

5. The collateral offered by the applicant is acceptable.

6. Due diligence by the Steering Committee has established sufficient documentation to support the bona fides of the application.

Posted in Programs & Projects

Small Wonder Organics

 

THIS LOAN WAS PAID BACK IN FULL AND AHEAD OF THE DUE DATE

The Background

Pete Engler and Sarah Trask run Small Wonder Organics,  a diversified certified organic vegetable farm situated on Brown’s Point Road. Entering its third year of production, the farm primarily markets through farmers’ markets, CSA distribution, restaurant accounts and local health food stores. Integral to their mission is increased access to ethically and healthfully raised local produce for all income levels. This is made possible through the acceptance of WIC vouchers, SNAP/EBT benefits, and flexible CSA payment programs. Stewardship of the land, responsibility to the community and fiscal prudence shape their business model.

The farm was facing the need for a substantial increase in productive capacity, and proposed to achieve it through expanded acreage and increased intensity of production via in-house tractor work and increased labor inputs. They identified machine criteria and located an appropriate tractor in nearby Richmond, applied to BCDI for a loan (the first!) to buy the tractor and still meet early season labor and capital requirements.

The Investment 

Small Wonder and Big BlueThe necessary funds were raised from 12 local investors, and a $7000 loan was disbursed at the end of January. The tractor is now working the fields down on the Brown’s Point. The initial investment plus 2% interest was repaid in full three months before the due date! In addition, the farmers as part of the interest on this loan provided 1% of the loan value in plant starts to the Bowdoinham Library Plant Sale in May.  In addition to supporting a local farm providing wonderful healthy food to the community (including through a CSA and a special “Tomato Passion Club”) the loan helped out  the Library, and the economy of the community (as part of its expansion, Small Wonder Organics hired the two persons for 20 weeks during the growing season).

Unexpectedly, over half of the original investors requested that their investment be “rolled-over” into future investments, giving BCDI a base for responding to future loan applications.

If you know other Bowdoinham community members who you think might be interested in making this kind of investment, or might want to seek this kind of loan, please have them contact BCDI.

Posted in Programs & Projects

Left Field Farm

The BCDI Loan Fund disbursed a $7000 loan to a young farmer starting an organic farm in Bowdoinham to purchase two greenhouses which are currently in place on the land where he is now farming. The purchase of the greenhouses is an integral part of a transition taking place within the farming community on the Brown’s Point Road, and Left Field Farm is now off to a great start fulfilling its CSA orders and taking stock of its first year of operations. Left Field Farm made its first payment on the BCDI loan in full and ahead of schedule on 20 August.

 

Posted in News, Programs & Projects