Are you the owner of a small business — especially one on South Temple — swimming in a sea of high-interest credit-card debt you've incurred to survive a two-year-long road construction project?
If so, the Salt Lake City Council has a deal for you.
In a move that created radical changes to the city's Small-Business Revolving Load Fund, the City Council Tuesday approved a plan that would allow small businesses to — among other things — refinance their high-interest credit-card debt with money from the fund, which comes at a low prime interest rate, about 4.5 percent.
Small businesses that are detrimentally affected by road construction will then be allowed to pay off part or all of their credit-card or other high-interest business debt with cheaper fund money.
"We told the business owners we would revisit this andbring it back in a timely fashion, and I think we've been true to our word," council member Dave Buhler said.
The council was set to finalize the loan fund criteria two weeks ago but they were besieged by small-business owners — many who have been all but decimated by South Temple reconstruction — who complained that they couldn't use the money to refinance existing credit-card debt, which carries the highest interest for small businesses. That was where the help was needed most, some owners said.
Additionally, the council Tuesday approved changes to the city's grant agreement with the Utah Microenterprise Loan Fund so that small businesses could also use that money to refinance credit card or other existing debt.
At a briefing last week Alison Weyher, community and economic development director, warned the council against allowing small businesses to use the money to refinance credit-card debt because it might dry up the city's loan coffers.
"I think we'll run out of money pretty quickly," she said. "That's a really good deal."
Weyher consented, however, when the council decided it would only allow businesses affected by construction to use the loans to refinance their high-interest debt.
And business owners said they need it in an economy that has been sagging for several years. It's been especially bad for businesses that have also had to deal with the massive South Temple reconstruction project that has been fraught with delays and cost overruns totaling at least $500,000.
Johnny Martinez, who recently relocated his barbershop off South Temple following a fire, said road construction had all but killed many small retailers there. In his small shopping plaza, two of the three access routes had been closed for construction.
"There was nowhere to get in and park so people just went somewhere else," he said. "All those businesses were really struggling."
The council hopes the loan changes will help. Besides allowing businesses to refinance credit card debt the council also approved a plan that provides a waiver of the collateral requirements that had been needed to secure a loan. Meanwhile, South Temple construction continues slated for completion late this fall.
E-mail: bsnyder@desnews.com