The Delaware Economic Development Office recently highlighted a new state and federal program last week aimed at helping businesses get private capital for growth and expansion at below-market interest rates. A lack of capital at lower interest rates remains a problem for smaller businesses, according to the agency.
- Jack Markell, Mike Kinnard and Neil O’Connell from TotalTrax were on hand for the grand opening of a new production site and the unveiling of a new business loan program.
Del. Gov. Jack Markell U.S. Senator Tom Carper and DEDO Deputy Director Bernice Whaley officially launched the Delaware State Small Business Credit Initiative. The event was held at TotalTrax, which also marked opening of its new facility in Newport, Del.. Manufacturing has been struggling in Delaware after the closing of the state’s two auto plants and the uncertainty surrounding a federal loan that would reopen the former G.M. plant near the TotalTrax site. The site is slated to assemble a mid-sized Fisker hybrid automobile that is expected to be unveiled early in April.
TotalTrax, which supplies equipment monitoring products and indoor tracking technologies, and is among the first businesses to take advantage of the program. The company was awarded a loan to expand its operations into a new 19,669‐square‐foot production and distribution facility in the Newport Industrial Park. The Development Office says the move is creating 15 new jobs, bring total employment to 50 at the site west of Wilmington.
“Businesses need access to credit to be able to make the investments they need to grow,” Markell said. “With this new funding program, more businesses like TotalTrax will gain the ability to expand, and in the process, put more Delawareans back to work.”
The program is funded by a $12.1 million commitment from the U.S. Treasury. Delaware expects to generate at least $10 in new private lending for every $1 in federal funding, supporting up to $121 million in new private lending in the state.
“As our economy continues to recover, access to capital is a critical need for Delaware business owners. The Delaware State Small Business Credit Initiative will help small businesses get the capital they need to make improvements, expand their business and hire more workers,” said Carper. “This is a great example of the federal and state governments working together to provide a nurturing environment for job creation and business growth for businesses in the First State.”
The loan involves one borrower, DEDO and one lender. The lender is able to offset a portion of its risk exposure and that provides incentives to lend more at a lower bank.
Fulton Bank, a bank with operations in New Castle and Sussex Counties, (formerly Delaware National Bank) participated in underwriting for the TotalTrax loan. The total loan is for $445,000. Of that amount, $111,250 will be awarded from the federal program.
“We are proud of our new facility and excited about our official grand opening,” said Mike Kinnard, TotalTrax CEO. “We are in the final phase of relocating our Texas manufacturing site to our new corporate headquarters here in Delaware. In conjunction with this relocation and expansion, we have already created 15 new jobs with more to come in the future.”
Kinnard added, “With the help of the SSBCI loan participation program, TotalTrax was able to work with the state of Delaware, the federal government and Fulton Bank to facilitate job creation in Delaware – this is an example of public‐private partnerships at their best.”
The new facility includes expanded manufacturing and warehousing, along with a demonstration area for products and software, thereby creating a national demonstration site for current and potential customers.
“The State Small Business Credit Initiative is another program added to the wealth of services available to assist small businesses in Delaware,” said Bernice Whaley. “We hope it will help many more businesses continue to make critical investments they need to expand and create jobs in the state.”
Further information is available at http://dedo.delaware.gov/SSBCI. For more information about TotalTrax, Inc., visit www.totaltraxinc.com
