The old revolving loan fund was limited to buying and renovating downtown property, while the proposed fund would help businesses citywide not only with rehabilitation costs, but inventory, marketing and feasibility studies.
City officials plan to meet with several local banks Friday afternoon to ask for their support to get the fund going, which could happen as soon as January, officials said.
The fund could help retain businesses and attract new ones, Bruchey said.
"If this doesn't work, then it doesn't work and we try something different," Bruchey said.
"I think it's a wonderful idea," said Neikirk.
Neikirk and Rider are repaying a $130,000 loan they used to buy and renovate 68-70 W. Franklin St., said George Andreve, manager of the city's Department of Community Development.
The property was leased to 4-Star Pizza, which closed a few years after opening. Neikirk and his partner have since expanded their own businesses into the property, he said.
Business owners, especially those downtown, need every advantage they can get, Neikirk said.
Bicycle shop owner Bob Twigg said he wished the new revolving loan fund already existed. It would have saved him from waiting more than a year to get a loan through the state's Neighborhood Business Development program, he said.
Twigg, who said he runs a small business competing with big retailers such as Wal-Mart, needed a loan for inventory and to get him through a rough time.
Bruchey said the proposed revolving loan fund could have reduced Twigg's wait for financing to one month.
"Not every business can last six months if it's waiting to get some help," he said.
Under the proposal, businesses could apply for loans for up to between $5,000 and $25,000 to be paid back over as many as 10 years and at an interest rate two percentage points below the national prime.
The city and at least five banks would provide $50,000 each every year for five years to get the fund started. Then the fund could become self-supporting as loan payments are used to make loans to other businesses, officials said.
"Certainly, a revolving loan fund would be an asset for any small business," said Pam Reed, owner of The Book Store and chairwoman of the Downtown Assessment District.
Small businesses could use the fund to boost inventory during peak periods, such as the Christmas shopping season, Reed said. The loan could be paid back quickly because of expected sales during peak seasons, she said.
"It would have been extremely advantageous for me when I started Round the Square," said restaurateur Harry Grandinett.
"It's something else to use to attract new businesses and for promoting Hagerstown as a business-friendly place," he said.
City officials also are looking at starting a matching grant program so downtown businesses could receive up to $1,000 for facade improvements and up to $300 for signage.