AUGUSTA—The Legislature’s special workforce committee heard yesterday from twelve business and financial leaders about the importance of a small business bond to grow Maine’s small and mid-size businesses.
“We heard clearly from financial and business experts that Maine is on the precipice of an economic burst and we need to be prepared for it,” said Democratic Senator Linda Valentino of Saco, the Senate Chair of the committee. “Our state’s businesses are asking for and need a small business bond now so that they can have the capital needed to grow and create jobs.”
The workforce committee also recently heard from Geoff Gattis of Bath Savings Institution that the commercial lending environment was "all about hitting singles." Both Gattis and USM economist Dr. Charlie Colgan argued that by passing a targeted, small-business bond package at this time, Maine's private sector could accelerate significantly -- effectively hitting more economic doubles, triples, and home runs.
"Now's the time to position support for those businesses that are ready to grow," said Colgan. "It is extremely timely that you're thinking of doing this."
Specifically, business leaders focused on the need for flexible, Maine-based capital, both loans and equity, as Maine businesses seek to grow and add jobs. The programs highlighted were flexible, low-interest loans administered by the Finance Authority of Maine (FAME), and equity investments by the Maine Ventures Fund, formerly the Small Enterprise Growth Fund.
"The business and financial leaders we've heard from have made it crystal clear that we have a once-in-a-lifetime opportunity to scale up Maine's businesses and economy," said House Majority Leader Seth Berry of Bowdoinham, House Chair of the committee. “Timely investment by the state can help small businesses jump up to the next step.”
John Turner, a consultant for Maine Heritage Weavers, stated that thanks in part to FAME and the U.S. Small Business Administration, Maine Heritage Weavers was able to expand from three floors of an old mill in Lewiston to a 65,000 square foot building in Monmouth. Maine Heritage Weavers shares the building with another weaving company, and between the two, they employ more than 50 people in a building that would otherwise have been vacant.
Shannon Kinney of DreamLocal Digital described how the Maine Ventures Fund let her grow her business in Rockland, rather than selling to Google and relocating. "Because of Maine Ventures Fund we were able to stay in Maine," said Kinney.
Roger Brooks, the Chair and Co-Founder of Abierto Networks, explained that his company relocated to Maine from New Hampshire in 2011 in part because of the opportunities for early stage funding through groups like the Maine Ventures Fund and the Maine Technology Fund. “MVF’s lead role definitely provided certain comfort to other investors and without them it would have been more difficult to secure adequate funding.”
In 2011, Governor LePage vetoed a $20 million research and development (R&D) bond passed by the Legislature. Since then, Democratic lawmakers have been urging Governor LePage to support R&D investments or other business investment bonds that will focus on commercialization and job creation for Maine businesses. In August, Governor LePage told legislative leaders that he would consider a business bond.
"Our problem (in Maine) isn't starting small businesses. Our problem is getting small businesses to become big businesses," Colgan added. "What Maine needs to move the needle is helping more ten person companies to become hundred-person companies."
The Workforce Committee will hold its next meeting Friday January 17 at 9 a.m. in room 438 of the State House.
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