In the past, if a new or expanding business in North Dakota needed additional capital to go along with its loan from a local financial institution, it could visit a number of state or federal agencies, such as:
- the Small Business Administration (SBA),
- the Bank of North Dakota,
- and the Department of Economic Development and Finance.
And in a sprawling state like North Dakota, the business would likely have had to make several trips to a distant town to make its pitch and fill out forms. But beginning this spring, such a business would only have to visit the Bank of North Dakota and the new North Dakota Capital Center, a joint venture of the bank and the SBA, the Dakota Certified Development Corp. and the U.S. Department of Agriculture's Rural Development program.
"The purpose is to cut the red tape," says John Hoeven, president of the Bank of North Dakota. "Here we can sit down in one place and get the job done." In most cases, Hoeven says, a business, along with its local lending institution and its local economic development agency, will likely approach the Capital Center for funding.
There are 10 other such centers in the country, according to Jim Stai, district director for the SBA in Fargo, but all the others focus on urban locations—the Bismarck center is the first in a rural state. Stai hopes that Bismarck will become a model for other rural locations. The Bank of North Dakota was chosen because of its central location in the state and its "good working relationship" with lending institutions and development agencies, Stai says.
"In its most pure form, this really is a one-stop capital center," Stai says, because the Bank of North Dakota is also hosting a new Business Information Center, which will provide technical assistance to prospective business owners, primarily through computer-assisted research, printed materials and group training sessions. This effort is sponsored by the bank, SBA, state agencies and the local Service Corps of Retired Executives.
Hoeven says the Capital Center is "absolutely not a competitive player" with North Dakota banks. "This is not government competing with private enterprises, but government doing its business right."
And bankers know that, Hoeven says: "They recognize that none of the players [in the Capital Center] originates loans; rather, they work with the local banker."
—David Fettig
