Pierz approves gap loan financing for the purchase of Hartmann’s, Lloyd’s Liquor

Pierz approves gap loan financing for the purchase of Hartmann’s, Lloyd’s Liquor Main Photo

12 Mar 2021

Community, Business, News, Economic Development

Upon a recommendation of the Economic Development Authority (EDA), the Pierz City Council approved a gap financing loan for Shawn and Ashley Janson, at its Monday meeting.

The Jansons plan to purchase Hartmann’s — a cornerstone business that’s been in the community since 1895, as well as the attached Lloyd’s Discount Liquor. Both businesses are currently owned by Lloyd and Donna Boeder.

The $25,000 is one of three gap financing loans the Jansons are seeking, in addition to bank loans they are working on. The other gap financing loans being sought are from the North Central Economic Development Association ($91,500) and Morrison County Community Development ($53,500), both at 5.25% interest, according to paperwork in the Council packets.

The Pierz gap financing loan will be at 2% interest, and paid back over 10 years.

“I think it’s a good thing for the town and community that someone is going to take that on,” said City Clerk Kyle Bednar. “Lloyd has been trying to sell it for a while.”

Having a young family come to town and keeping the business in town was a plus for Bednar.

Mayor Dave Fischer said gap financing is a way to help small businesses get going and keep going.

“I’m excited about this — it’s essential to keep these businesses in the community — especially a hardware store,” Fischer said Wednesday. “When residents start driving out of town to get certain items, they also stop and get other items. Anything we can get people to shop for in town benefits the entire community.”

Fischer said the gap financing comes from the EDA Fund, which is non-taxpayer money.

“That money has been earned through EDA type projects and TIF (tax increment financing) projects,” he said. “It’s money we have available that we can either do gap financing or TIF start-up stuff.”

He said the city has four funds that are set aside for this type of financial help for businesses — EDA funds, two Small Business Development funds, and a Minnesota Investment Fund. 

Read the full article here.