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Competitiveness Center’s loan to be refinanced

A Pulaski bank has agreed to accept $1.8 million in moral obligations as collateral for a $2.6 million refinancing loan for New River Valley Development Corporation.
Although only three of the eight jurisdictions that founded the development corporation agreed to moral obligations, Carter Bank & Trust accepted the $1,851,950 and is allowing the loan to move forward, according to Pulaski County Administrator Peter Huber and New River Valley Planning District Commission Director Dave Rundgren.
Rundgren said efforts are now underway to complete a closing on the loan by the end of June deadline.
New River Valley Development Corporation operates the Competitiveness Center business incubator at Fairlawn, in addition to providing other benefits to the founding jurisdictions.
The $2.6 million refinancing loan will allow the corporation to save about $35,000 per year and remain solvent when a $20,000 balloon payment comes due at the end of the month.
Pulaski County agreed to a moral obligation for half of the loan amount ($1,317,500), while the Town of Christiansburg obligated $350,000 and the Town of Pulaski, $184,450.
Floyd, Montgomery and Giles counties, Radford City, and the Town of Blacksburg did not participate in the moral obligations.
The Competitiveness Center currently has 19 tenants (including several regional agencies) and 65 employees. However, its occupancy rate is only 57 percent due to economic conditions and businesses having graduated from the center, Huber stated is a letter to the jurisdictions.
According to Pulaski Mayor Jeff Worrell, the success rate of businesses coming out of the incubator is 80 percent, compared to an 80 percent failure rate for small businesses that start without the benefit of an incubator.
Any jurisdiction participating in the moral obligation will have a “proportionate say in the management and operation of the facility, an equity position in the center and potential prospects for revenue generated by the center as occupancy increases,” Huber’s letter states.

Competitiveness Center’s loan to be refinanced

A Pulaski bank has agreed to accept $1.8 million in moral obligations as collateral for a $2.6 million refinancing loan for New River Valley Development Corporation.
Although only three of the eight jurisdictions that founded the development corporation agreed to moral obligations, Carter Bank & Trust accepted the $1,851,950 and is allowing the loan to move forward, according to Pulaski County Administrator Peter Huber and New River Valley Planning District Commission Director Dave Rundgren.
Rundgren said efforts are now underway to complete a closing on the loan by the end of June deadline.
New River Valley Development Corporation operates the Competitiveness Center business incubator at Fairlawn, in addition to providing other benefits to the founding jurisdictions.
The $2.6 million refinancing loan will allow the corporation to save about $35,000 per year and remain solvent when a $20,000 balloon payment comes due at the end of the month.
Pulaski County agreed to a moral obligation for half of the loan amount ($1,317,500), while the Town of Christiansburg obligated $350,000 and the Town of Pulaski, $184,450.
Floyd, Montgomery and Giles counties, Radford City, and the Town of Blacksburg did not participate in the moral obligations.
The Competitiveness Center currently has 19 tenants (including several regional agencies) and 65 employees. However, its occupancy rate is only 57 percent due to economic conditions and businesses having graduated from the center, Huber stated is a letter to the jurisdictions.
According to Pulaski Mayor Jeff Worrell, the success rate of businesses coming out of the incubator is 80 percent, compared to an 80 percent failure rate for small businesses that start without the benefit of an incubator.
Any jurisdiction participating in the moral obligation will have a “proportionate say in the management and operation of the facility, an equity position in the center and potential prospects for revenue generated by the center as occupancy increases,” Huber’s letter states.