The Agwood Mill & Lumber Company is on track to get a $2 million dollar loan. The board voted unanimously to apply for a $2.2 million state Community Development Block Grant so the county can loan Agwood Mill & Lumber Company to help finance the company’s debt from a 2003 expansion. The board agreed helping Agwood would preserve jobs and the county’s economy.
This is really Mendocino County’s last saw mill that has the ability to process Douglas fir, a main species on the inland side of Mendocino County. Nobody wants to see happen to this mill, what happened to the 50 year old Harwood Mill in Branscomb, which closed in 2008, laying off 200 workers.
Agwood in business for almost 30 years, employed 125 people at its peak and currently has 48 full time equivalent jobs.
The mill is located outside the county’s redevelopment area. The resolution the board adopted declared the Agwood site “spot blight”. The resolution says, “Activities that address the prevention of blight on a spot basis meet one of the national objectives that would make the county eligible for the grant funding from the CDBG program”.
Applying for the state grant requires a public hearing on how the county will use the money.
Agwood’s private lender agreed to modify the terms of the loan in conjunction with the county’s proposed loan. The secured county loan using CDBG money would be paid back over 30 years at a 2% interest rate. CDBG money does come with state and federal regulations.
It’s not a slam-dunk, but for the right business, as Agwood seems to be, this can ideally be a real bonus and a real good thing for the community. The CDBG loan repayments become “program income” which the county can use for future loans to other area businesses.
It is estimated the proposed Agwood loan would generate $10,000 per month for business loans.
Mendocino county can apply for up to 2.5 million annually through the over the counter component of the CDBG program, and currently has about $250,000 of program income available for loans to qualified businesses. He said the county is in the process of hiring a consultant to carry out the loan program.