The Isle Theatre in Cumberland, WI several years ago (when it was threatened to be condemned) and today, where the Downtown Facade program gave the moviehouse new life.

At a time when budgets are strapped and unemployment is on the rise, it’s hard to follow through with the spend-money-to-make-money mantra, but that’s exactly what the Eau Claire City Council just did.

With help from the county, the city recently bought its way into the Regional Business Fund and merely awaits a letter of certification to finalize the deal. The program lends money to businesses in hopes of promoting job creation, downtown revitalization, and increased entrepreneurship in Eau Claire.

Previously we were the only city in the seven-county area (from Polk to Clark) not eligible for these funds. The reason for this is a bit complicated; suffice to say that changes to the treatment of Community Development Block Grants created a pool of funds for the small communities in this region to apply for loans. Being the only entitlement city (one with more than 50,000 people) in the region, Eau Claire was deemed exempt from the program.

As such, the city has been fighting to get access since 2007, contacting the U.S. Department of Housing and Urban Development as well as the state – to no avail. Ultimately the RBF agreed to let Eau Claire in if it paid $500,000. The county chipped in $150,000 and the city drew from its economic development fund to foot the rest of the bill.

The advantage of buying into this program is strictly to benefit businesses in the city – both existing and starting up. The RBF has four aggressive loan programs, each with eligibility restrictions not detailed below.

•     • Revolving Loan Fund – Lends $25,000 to $150,000 with 4 percent interest up to five years. For commercial and industrial projects that create quality jobs and increase the tax base.
•     • Micro Loan Fund – Lends $5,000 to $25,000 with 4 percent interest up to 10 years. For start-up, newly established, or growing small businesses.
•     • Downtown Façade Loan – Lends $5,000 to $30,000 with zero percent interest up to 15 years. Encourages downtown business owners to revitalize commercial storefronts. (They adopted DECI’s downtown boundaries, meaning Water Street is included.)
•     • Technology Enterprise Fund – Lends $100,000 to $250,000 at prime +/- (dependant on risk) up to five years. Funds new or emerging technology companies.

All applications start at the city level, and either go before a city-appointed committee/board or to RBF, which is run out of West Central Wisconsin Regional Planning Commission.

The “catch” of letting Eau Claire in is that we’re restricted to $1 million in loans for the first two years ($600,000 for Revolving Loan Fund and $400,000 for the other three), while other communities have unlimited access. So when you’ve got hundreds of businesses in Eau Claire and loans of tens of thousands of dollars, one could surmise that these funds might run out rather fast.

“It’s too early to know what kind of demand we will have,” said city economic development director Mike Schatz, adding that they’re already receiving applications. “However, if we run out before the two years are up, it is our understanding that Eau Claire businesses will not be able to apply any more to the RBF programs.”

Schatz added that RBF will re-evaluate the city’s involvement after 2011, and could possibly lift the limit. Until then, businesses may also apply to the city’s existing loan programs, which are admittedly of smaller scale and have stricter guidelines.

“The city saw the value in it for businesses,” Schatz said, “and good loans will mean the funds will continue revolving.”

    To apply for RBF or city loan programs, contact Schatz at 839-6047 or e-mail him at mike.schatz@ci.eau-claire.wi.us.