To spur business development in the city, Hagerstown Mayor Bob Bruchey is trying to resurrect an idea from the early 1980s - a revolving loan fund for small businesses. It was a good idea 15 years ago, and can be again, but since there's not an unlimited amount of money, we recommend targeting most of those loans for housing renovation.
The old revolving loan authority, set up in 1982, was underwritten with $1.5 million obtained when the city sold Washington County what is now the Regional Airport. Community Development Block Grants were later added to the pool, and loans could be obtained for purchase and renovation of properties. The new fund would expand eligible uses for loans, to include the purchase of inventory and the financing of feasibility or marketing studies.
The new fund would have five local banks and the city make $50,000 a year available for the next five years, after which the fund would presumably be self-sustaining. But while $300,000 may be more than most residents make in a year, that amount won't go that far when it's building renovation projects we're talking about. The Baldwin House project - better known as the old Routzahn's building - would have cost $7.3 million to do over.