As the result of the Utah Technology Finance Corp. changing its focus somewhat in the last couple of years, activity in its loans programs has increased and the agency is realizing Gov. Mike Leavitt's goal of providing "bridge gap" financing for Utah companies and creating new jobs.
That is the gist of a report given by UTFC president Don Welty during the annual meeting of the agency's board of trustees Friday.And, unlike previous years, UTFC has borrowed money from the Farmers Home Loan Administration and purchased a building that will become UTFC's headquarters in the future. During an interview, Welty said there is nothing wrong with the agency borrowing since it is in the business of loaning money itself.
At the end of 1993, UTFC had financed 120 companies and helped create or sustain 6,500 jobs. The agency also attracted an additional $13 million in money from private sources or other agencies.
Welty said UTFC is not a venture capital organization, nor is it a bank. It is attempting to be a catalyst to close the capital gap in Utah by increasing the capital available to Utah businesses from investors and lenders. In urban areas, UTFC focuses on technology-based manufacturing firms and in rural areas the focus is on traditional and technology-based firms that will expand the rural economic base.
In the fiscal year ending June 30, 1994, UTFC made $11.3 million in deals with Utah companies, a 51 percent increase over the previous fiscal year; collected $2.3 million, a 152 percent increase over the $938,000 collected in the previous fiscal year; and disbursed $3.1 million in loans, a 24 percent increase over the previous year.
For every dollar of UTFC money put up, businesses came up with $3.55 in the fiscal year ending June 30, 1994, higher than the 2.77 leverage figure of the previous fiscal year, Welty said.
In addition to the $2 million of its own money allocated by the Legislature in the fiscal year ending June 30, 1994, the agency received $2 million in revolving loan funds from the Farmers Home Administration to assist rural Utah businesses, and is attempting to get some money from the Defense Conversion Revolving Loan Fund to offset the impact of defense base closings.
Businesses borrowing money from UTFC are varied and include a skin care lotion company, grocery store and trading post, computer and software equipment business, river-running business, computerized hotel refrigerator company and dental-supply business.