Fort Collins, Colo. – The Colorado State Forest Service and its economic development partners and the Upper Arkansas Area Council of Governments give loans to coronavirus-affected forest product firms in Colorado.
Initiated through the Colorado State General Assembly in 2009 In 2009, the Forest Business Loan Fund has given out $5 million in loans to small-sized companies in forestry and wood products in Colorado. In recent times it has provided crucial support to companies suffering from the coronavirus who may not be eligible for or access traditional funding sources.
“Since the beginning of this pandemic we’ve had nearly one million dollars of new applications for funding through the loan program from companies located in southwestern and northern Colorado,” said Tim Reader, Wood marketing and utilization specialist for the CSFS. “Our forests and hazardous mitigation companies continue to run and the funding they get through the program can help the businesses employ people who are recently laid off or purchase new harvesting equipment or manufacturing machines or develop new products, and satisfy other capital requirements for working capital.”
A reader told us that, for instance, one applicant wants to recruit new employees and purchase new logging equipment to supply economically an abundance of wood to a different sawmill located in southwest Colorado.
“Due to COVID-19, a few of our forest products companies located in Colorado have witnessed a significant decrease in the demand and prices on traditional products made of wood,” stated Molly Pitts, executive director of the Colorado Timber Industry Association. “It is beneficial to know that there is a loan program in place. Colorado State Forest Service and the Upper Arkansas Area Council of Governments have an existing loan program that these businesses can use particularly during this challenging period.”
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The Forest Business Loan Fund assists businesses that may not be eligible for standard bank financing. Therefore, it is not competing with commercial banks, Reader said. However, the loan program may help provide additional capital for lending to companies as experts in forestry working with the CSFS examine and approve every loan application.
“Through our fund we in bridging gaps between wood product industry and lenders to boost the capacity of managing forests within Colorado,” Reader said. “The Upper Arkansas Area Council of Governments lends their lending and business knowledge and we contribute our wood product harvesting manufacturing, market and production experience, which allows for a collaborative lending strategy.” This fund assists the CSFS in achieving its goal of conserving forests in Colorado by helping the forest products industry. Businesses who receive loans should use beetle-killed or other wood from projects to improve forest health, like projects that help reduce wildfire risk. The reader explained that this leads to better communities, forests, and local economies. This is crucial during the current difficult times.
“It’s an all-win situation,” Reader said. “We’re creating the capacities to carry out forest health initiatives and helping maintain or create jobs to support small-scale businesses as well as our neighbors.”