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Perham, Minnesota | October 29, 2014

Marie Johnson |

Perham was well represented at this year’s awards ceremony for the Minnesota Business Finance Corporation.

United Community Bank won the corporation’s 2014 Lender of the Year award, while Chuck Johnson, Perham’s Economic Development Director, was one of four joint winners of the Member of the Year award. Terry Stallman, an economic development consultant with Otter Tail Power Company, was also named a Member of the Year, partly due to his work in Perham.

The awards are given to members and lenders who refer and help seal the largest number of deals between developers and the Minnesota Business Finance Corporation, or MBFC. Those who secure the highest loan dollar amounts are recognized.

All of MBFC’s members across Minnesota are eligible for the awards. For the small town of Perham to represent the majority of winners says something about the strength of the local economy.

“It really is an indicator of what’s been happening in Perham,” said Chuck Johnson. “Perham is the gold standard for small towns in the state of Minnesota… Perham is a very active community, and one of the things that helps Perham a lot is that we have good local banks. That keeps things moving and developing.”

“We’re excited,” said Ryan Rustad, a loan officer at United Community Bank, of winning the award. “It’s nice to be recognized for that, but really I think it’s more of a testament to our community and our local and regional economy. It’s like a big locomotive that’s got a lot of momentum behind it. We’re happy to get behind some of these projects in the communities that we serve and be able to contribute to some of that economic impact.”

The MBFC is a private, non-profit organization licensed by the Small Business Administration, or SBA, as a certified development company. The MBFC is authorized to originate and service certain SBA loans throughout Minnesota. The organization is able to offer fixed-rate financing to entrepreneurs.

MBFC’s mission statement is, “Working in partnership throughout our service area to foster business development and job creation and retention.”

In 2014, the organization approved 82 loans, with project costs totaling more than $126 million. Of seven organizational regions within Minnesota, the west central region, which includes Otter Tail and a dozen other counties, saw the highest dollar amount of loan approvals.

Stallman, a former MBFC board member, said most of those dollars go toward the new construction, expansion or acquisition of motels, manufacturing facilities, service companies, healthcare facilities, restaurants and retail stores.

Two of the big projects that helped bring Perham into the MBFC spotlight are the ongoing expansion at Industrial Finishing Services and the construction of the Hadley House assisted living facility (formerly Someplace Safe). United Community Bank, Johnson and Stallman worked together to secure financial backing for these and other projects through the MBFC and their SBA loan programs.

Stallman said the MBFC is like a “middleman” between local banks and the SBA. By being aware of available loan programs and staying connected with banks and developers in their communities, Johnson, Stallman and other MBFC members help facilitate financing deals for commercial projects. The local banks then step in to contribute to the lending process.

“It takes capital to get things moving,” explained Rustad. “We as a bank have a lot of resources, but we need to partner to get some of these things done. We partnered with the city…and they were able to help with some gap financing to make things happen. Without the MBFC and Perham EDA (Economic Development Authority), projects probably wouldn’t get done as quickly or as easily as they do.”

According to Rustad, the MBFC helps make the financing process “simple and smooth.”

Over the past 20 years, the MBFC has built up a $260 million loan portfolio across the state, and Stallman said most of those dollars have gone to rural areas. That’s just the MBFC’s loan share; when factoring in bank and other financing, the total cost of all the projects the organization has helped finance is roughly three times that amount.

In Perham, the program “has had quite an impact,” according to Stallman. A large handful of businesses in town have benefitted from MBFC services in the past, helping to foster growth and economic vitality in the community.

The awards were announced at MBFC’s annual meeting, held in St. Cloud last Wednesday. Other Member of the Year award winners were John Elden, of the Northland Foundation in Duluth, and Gordon Winzenburg, of CMG Finance in Brainerd. Winners received plaques and gift certificates. As Lender of the Year, United Community Bank will get to attend the National Association of Development Companies 2015 annual meeting.

United Community Bank at MBFC Awards ceremony

Submitted photo

United Community Bank was recognized as Lender of the Year by the Minnesota Business Finance Corporation. Pictured are bank employees, left to right, Bryce Anderson, Cedric Rossow, Ryan Rustad and Charles Cavanagh, with the corporation’s CEO, Tom Saehr.