Washington D.C. Lends Interest-Free Business Loans
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UPDATED: Aug 27, 2012
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Washington D.C. has lent a total of $1.2 million in interest-free small business loans to local owners since the start of the year, reported the Washington Examiner.
The 14 business loans lent were a product of the city’s Department of Small and Local Business Development program that began last November. All of the business loans—ranging from $40,000 to more than $150,000—were given to commercial institutions that were negatively affected by the city’s ongoing construction.
The construction, which was required to replace high pressure gas lines underneath the streets, caused sidewalks and roads to be inaccessible at times.
One recipient, Carolyn Thomas, the owner of C.A.T. Walk Boutique, described why her commercial financing was necessary.
“A lot of people couldn’t tell that I was open. On several occasions I’d go [to work] and they were digging right in front of the door so I couldn’t open that day. Another day I couldn’t open because they [were laying in] new cement on the sidewalk. I was already on a part of [the street] where if you blink, you miss it,” she told the Washington Examiner.
Thomas received a $40,000 business loan and used part of that money to relocate her store to a more accessible property.
When the gas line construction began, Washington D.C. didn’t immediately offer interest-free business loans, but instead released this program when they saw a dire need for it. It wasn’t until after the city saw a slew of local businesses close their doors between 2007 and 2008, when those companies lost as much as 60 percent of their business and were forced to shut down.
The Department of Small and Local Business Development program appears to be a local effort to to compensate for the void left when the government’s Small Business Administration either refuses or is simply not able to help.
“I think the city is now recognizing the impact of major street construction on small businesses and doing something proactive about it,” said Kristen Barden, executive director of the Adams Morgan business improvement project.