From the NW Asian Weekly:
Offering below-market-rate loans for the Rainier Valley business community, the Rainier Valley Community Development Fund (RVCDF) continues its role in reviving business development after the light rail construction in the area. Former Seattle City Councilman Richard McIver was appointed as interim executive director in October to help guide the fund and draft a strategic plan for its future.
History of RVCDF
The RVCDF was established in 1999 in response to the massive construction project for the light rail in the Rainier Valley neighborhood. It was created as a self-sustaining, community-controlled, financial institution to stimulate economic development in the Rainier Valley area. The City of Seattle and Sound Transit committed $50 million to the fund. McIver hopes that the RVCDF will remain self-sustaining, and the strategic plan will address RVCDF’s sustainability. It is anticipated that funding from the City of Seattle’s Office of Economic Development will provide ongoing support for RVCDF activities through 2012.
The RVCDF first served as a fund to mitigate losses for existing businesses along Martin Luther King Jr. Way during the light rail construction. It now supplies loans for businesses in the Rainier Valley area.
At this time, approximately $14 million remains for business loans. For established businesses, loans average about $200,000 for a term of 5 years.
However, the range for loans is $50,000 to more than $500,000. For smaller or newer businesses, loans range from $10,000 to $50,000. “Our organization … assisted 99 Asian businesses during the light rail project and … made several loans after the project was completed,” stated RVCDF’s Business and Retention Program Officer Charleete Black in an e-mail.
Helping businesses after light rail construction
As interim executive director, McIver listed three priorities for the fund. “The first priority is to work with people that have survived the light rail,” McIver explained. This is in reference to business owners that endured the construction and are continuing or expanding small businesses. The next priority is real estate development, which includes looking at new investments from developers. The final priority is recruiting new businesses to the Rainier Valley area. He sees opportunities in building businesses in areas near the light rail stations at Henderson, Othello, and Columbia City to enhance ridership on the light rail line. McIver also hopes to develop a marketing brochure for the RVCDF to attract new businesses.
McIver indicated that his role at the RVCDF is temporary. “I agreed to take it on for 6 months, and we’ll see what happens,” McIver said. Prior to the end of his tenure, McIver will draft a strategic plan for the RVCDF, which will provide a roadmap for the future of the fund. A draft will be submitted to the board in May for consideration.
Although the RCDVF was welcomed by many businesses, there has been some criticism. Seattle City Councilman and former legal counsel to the RVCDF, Bruce Harrell, acknowledges the challenges the RVCDF faced, despite the fact that the vast majority of people were pleased with its work. “The feedback was very good, but some vocal people believed that the fund should do more, as they felt their businesses were still impacted.” Harrell added, “Some believed that the loan process was too difficult and the mitigation payments were too low.”
McIver recognizes that the RVCDF has denied businesses loans. “Some [business owners] are concerned with providing their personal finances [in order to qualify for a loan],” explained McIver.
“We are here to help people with business loans.”
RVCDF looks at factors including character, business capacity, and projected cash flow, as well as the impact a business will have on the Rainier Valley community. The RVCDF also provides one-on-one counseling and technical assistance.
Success story: Filipino Community of Seattle
One of the organizations that the RVCDF has helped is the Filipino Community of Seattle (FCS). A mainstay in the Rainier Valley since 1935, the Filipino Community Center sought help from the RVCDF when it looked to make improvements on its building. FCS received a $250,000 loan to finish renovations on its building.
“We knew that we would be able to afford their interest rates on their loans and, since the Filipino Community Center is one of the anchor institutions in Rainier Valley, they would understand our situation and they would be more willing to help us than a traditional bank,” stated FCS President Alma Kern. “As everyone can see now, we were able to add another 5,000 square feet to our building, including a second story with two big classrooms [and] meeting rooms, offices on the first floor, and a beautiful lobby.”
The funding for the renovation has produced positive results. “Since our renovation was completed in 2008, we have tripled the number of people visiting our center, doubled our rental income, and the numbers of meetings that are held at the center from various nonprofits and government agencies have tripled,” said Kern.
Future RVCDF leadership
Harrell hopes that the RVCDF will continue to assist businesses in Rainier Valley. “It is needed now more than ever because lending requirements are so tight. [This is] all the more reason for the RVCDF to have a strong portfolio.” He added, “The [RVCDF] board needs to be more aggressive to be established in the community.”
Harrell is positive that McIver will help lead the RVCDF in the community. “Richard McIver will do a good job in ensuring that new leadership is moving forward.” Kern mirrored Harrell’s comments, “Nobody knows and understands the Rainier Valley and its residents more than Richard McIver,” Kern said. “Richard McIver has the vision, compassion, and dedication to transform Rainier Valley into a community that is for everyone.