Koochco is a private, non-profit gap financing agency. Koochco’s loans are meant to create and maintain permanent employment through the establishment of new businesses or the expansion of existing businesses in Koochiching County. To be eligible for this program, the business must be located within Koochiching County.
Resort/tourism projects which attract expenditures from outside the region
Manufacturing and industrial operations
Service, office sector, health care, cold weather testing
Retail businesses will be considered case by case
Special consideration is also given to businesses locally started and funded, demonstrating renovation and growth potential
The applicant may be for-profit or non-profit and may be new or expansion of an existing business
Review Criteria (consideration is given to the following factors):
Eligibility as outlined above
Quality and number of jobs created and retained
Demonstrated repayment ability
Degree of collateral coverage
Economic impact on area
Management capability and character
Degree of business participation in project
Completeness of business plan
All Koochco loans will be term loans. Maximum amortization will be 20 years and active participation will be limited to 5 years in most cases. The policy will require a balloon payment or call provision after the fifth year of the loan.
The Koochco loan will be no more than 50% of the project financing with a maximum loan amount of $40,000; the remainder to be financed by a private lending institution. The interest rate on the Koochco portion will be 1% less than bank rates and follow bank rate structure.
Collateral coverage must satisfy both Koochco and the bank; personal guarantees are required. Demonstrated credit worthiness and commitment of the applicant is required; management experience or other qualifications will be reviewed, as well as marketing plans. Projects that are entirely or primarily a refinancing of existing debt will not be allowed unless such refinancing will result in a significant upgrading or expansion of operations and creation of jobs.
Eligible Uses of Loan Funds:
Land and building acquisition and improvements
New building construction and building renovation
Purchase of machinery and equipment
Resort expansion of facilities or upgrading of accommodations
Working capital (not a revolving line of credit)
Reasonable accounting, legal, architectural, engineering and appraisal fees
A preliminary review of the project shall be completed by a banker and/or Koochco staff to confirm the loan request meets Koochco guidelines.
The completed application accompanied by a business plan shall be submitted to Koochco.
Upon review by the Koochco Board of Directors, the business will be notified of approval, ineligibility, or if more information is required.
Koochco Contact Information:
P.O. Box 407
405 3rd Street
International Falls, MN 56649