A “green” revolving loan fund with low interest rates is being offered by the Dutchess County Economic Development Corp. to help small businesses become more energy efficient as a way to a better bottom line.
The Dutchess County entrepreneur of the year has already taken advantage of the chance to incorporate a geothermal heating and cooling system in a new building he is constructing.
“I”™m trying to use my head,” said Bob Baxter, president of R.L. Baxter Construction Company, who was named the county entrepreneur of the year for 2008 and who is using geothermal heating and cooling in a new 15,000-square-foot medical and office building he is constructing on Washington Street in Poughkeepsie.
Loans will be from $5,000 to $75,000. To qualify, projects must show that they will create new jobs or retain existing jobs. Applicants can be businesses, nonprofit employers, or building owners, said Cathy Maloney, DCEDC business development specialist. She said uses for the funding include solar, wind, green-planted roofs, energy-efficiency measures such as upgrading windows, better machinery, boiler retrofits and geothermal systems.Â
“Any of those projects would qualify,” said Maloney. “There are a lot of people becoming more aware of the need to conserve energy and we want to be able to help them. The green revolving loan fund is open to businesses in Dutchess County and we”™d love to get more businesses interested in it.”
Interest is a key attraction to the loan fund. Recipients get an interest rate pegged to the prime which is currently at 3.25 percent fixed over the life of the loan.
But that is only part of the attraction, according to Paul Calogerakis, chairman of the DCEDC business services committee who is employed by Key Bank in his day job. Taking advantage of the loan, especially at such a reasonable rate, he said, “Ultimately it saves the business money in their energy efficiency. For a very low interest rate they get return on their investment and that should help small businesses all over Dutchess County.”
After receiving a $75,000 loan for his geothermal system from the Green RLF, Baxter said the system will pay back the investment in five years based on current oil prices.Â
There are no greenhouse emissions and: “I won”™t need any flame in my building,” said Baxter, meaning there is less risk of fire, an advantage he hopes to parlay into reduced rates for insurance on the building. And since the equipment is all contained inside or beneath the building, it is not exposed to the difficult elements of the Northeast climate, he envisions replacing equipment every quarter century instead of every 10-15 years.Â
Another advantage is in leasing his property to tenants. Baxter said that as part of the lease he will pay all heating and cooling costs, an advantage for businesses since it allows them to plan for a stable energy bill instead of being concerned about price fluctuations.Â
Calogerakis said that some revolving loan funds in the past have encountered problems from businesses unable to repay their loan. The Green RLF avoids that problem because rather then being geared to help startup firms, the loan fund is designed to improve already successful businesses.
“I think we have eliminated a lot of the problems RLFs have had in the past by giving the loan a specific purpose, this is for energy efficiency,” said Calogerakis. “It gives business an opportunity to consider investing in green rather than just using money for surviving this economic climate.”
