Loans totaling more than $1.8 million have been made through Davis County's economic development program over the past five years, bringing in 13 new businesses and generating 367 jobs.
Rick Mayfield, county economic development director, reported on the program's success to the Davis Council of Governments the program's governing body.The county set up a revolving loan fund in 1985, deciding to use a portion of its federal Community Development Block Grant money for countywide economic development rather than specific projects.
In the years between 1985 and 1990, loans totaling $1,885,217 were made, which Mayfield said helped generate another $7.1 million in private financing.
Most of the loans went to existing businesses for expansion, Mayfield reported, but the program also helped bring 13 new firms into the county. Six new buildings were constructed, three were expanded, and the county purchased an 11-acre industrial park in west Kaysville.
While most of the firms aided are successful, a few went bankrupt. But Mayfield said the loan fund has only lost $2,500 in five years on bad loans.
Bankrupt firms either sold out to another business or the county recovered its investment through bankruptcy proceedings, Mayfield said.
"These loans go to, by definition, risky businesses that can't get loans from conventional sources," Mayfield said. "By definition, it's a gamble but we've done extremely well, overall."
The loan program is supervised by Mayfield and a committee made up of council members, who are mayors or city managers from the city and county governments in Davis.
In 1990, the last year for which figures are available, the economic development program received 80 inquiries about loans, making three loans totaling $280,000. That generated a collateral investment of private funds totaling $618,000.
Compared to other counties along the Wasatch Front, Mayfield said Davis County is doing very well. In 1988, the county - which has 11 percent of the state's population - landed 18 percent of the state's new businesses, totaling 23 percent of the jobs created.
The economic development program includes an effort to steer federal procurement and purchasing contracts to local firms, most often coming out of Hill Air Force Base. The county has a full-time employee, Kerry Lindgren, who works as a federal procurement specialist.
According to Lindgren, Davis County companies landed $3.1 million in government contract work in 1990.