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Partnership Outlines Community Development Programs

The Falmouth Enterprise

By Brittany Feldot

The Cape Cod Community Development Partnership has similar objectives for the Lower Cape as the Falmouth Economic Development and Industrial Corporation has for the Upper Cape, but it pursues them in markedly different ways.

During a meeting of the Falmouth EDIC on Tuesday, January 10, executive director Jay Coburn gave a presentation on the history and operations of the partnership.

The Community Development Partnership is a nonprofit corporation that has served the eight towns of the Lower Cape for about 25 years. Based in Eastham, the corporation works to develop affordable housing and support the local economy, and is perhaps best known for its micro-lending programs.

Mr. Coburn said the corporation has $300,000 in loan capital, and offers small business loans up to $40,000 with a focus on businesses that are not eligible for bank loans. The program was originally limited to serving those earning at or below 80 percent of area median income, but has since expanded to serve loan-seekers earning up to 100 percent AMI.

Since its inception, the corporation has meted out $2.7 million in loans to more than 135 small businesses in hospitality, retail, fishing, farming and aquaculture.

One such program is the partnership’s shellfishing loan fund, which supports local shellfish farms through the Wellfleet SPAT (Shellfish Promotion and Tasting) program. The corporation provides loans up to $20,000 for high quality seed, gear and refrigeration needs.

“One of the things that’s going on in the shellfishing industry in Wellfleet is we’re seeing families, who for many years [shellfishing has been] a borderline business and hobby, passing that business to a younger generation that is really interested in using more sophisticated gear and propagation techniques to increase the quality and volume of production in their oyster grants.”

The partnership also established the Cape Cod Fisheries Trust with the Cape Cod Commercial Fishermen’s Alliance in Chatham, which is designed to preserve the small-scale fishing industry on the Lower Cape.

Mr. Coburn said that the scallop industry essentially operates under a federally orchestrated cap and trade economy, where fishermen are allotted individual fishing quota (IFQ) that can be bought and sold to other scallop vessels. The limited access program was implemented in 2011 by the New England Fishery Management Council, and Mr. Coburn said that a large portion of scallop quota was allotted to the large fishing industries, such as those in New Bedford.

In order to revive small business fishing on the Lower Cape, the corporation purchased a collection of scallop quotas to create a permit bank, which they lease at below market rate to local fishermen with best business practices. A loan program also offers fishermen the chance to purchase quotas over time, with no required collateral besides the quotas themselves.

In 2016, the partnership lent 280,000 pounds in scallop quotas to 14 fishermen, who generated about $5 million in gross sales.

Last year, the corporation, in conjunction with Cape Cod Healthcare, also helped establish the Orleans Winter Farmer’s Market. The operation is the only winter farmer’s market on the Lower Cape, and Mr. Coburn said it drew $46,000 in sales in 2016 for farmers who would usually be dependent on the seasonal market outlet. In the next few years, the summer Orleans Farmer’s Market will take over management of the winter market as well, continuing operations independently.

The community development partnership offers business education and counseling services, providing technical workshops in programs such as QuickBooks.

Mr. Coburn said that one of the largest challenges to economic growth on the Lower Cape is a lack of affordable housing, which drains the employee base for small businesses.

Another major handicap, he said, is that the Lower Cape lacks a culture of entrepreneurship. As a result, those that are interested in starting their own business ventures often lack formal business training needed to get ideas off the ground.

He added that the problem is exacerbated by an anti-local culture that finds root in Lower Cape schools.

“Many folks who I talk to that have grown up on the Lower Cape share their experiences of being in school, in very good local schools, and being encouraged to get out,” rather than being encouraged to return and contribute creatively to the local community, Mr. Coburn said.

Although the partnership has to fight a cultural tide undermining local business development, Mr. Coburn said he is optimistic about the future of the Lower Cape.

One business model that Mr. Coburn said the corporation is particularly interested in is “export businesses,” businesses that curate local brands that are marketable beyond Cape Cod. One example of an export business that the partnership has invested in is Chequessett Chocolate in Truro, which started three years ago and has already begun to sell their products in high-end chocolate stores across the country.

Last year, the corporation helped to create eight new businesses; stabilized 10 businesses; created 31 jobs; preserved 17 jobs; and granted $381,000 in loans to 14 businesses. It has also worked to create 75 units of affordable rental housing since its inception.

The corporation has a $3.4 million budget, and is funded through a combination of program funds, grants and donations. Through a community investment tax credit program, donors to the corporation receive a 50 percent tax credit on their donations, with an additional federal tax deduction on the reduced sum such that a donation of $1,000 ultimately costs the donor $325.

About 40 percent of the partnership’s funding comes from program income, such as rents on affordable housing units, counseling costs and loan interest. It also receives about $180,000 each year from the Cape Cod & Islands license plate fund.

EDIC board member Susan L. Moran asked Mr. Coburn how the EDIC might go about starting a micro-loan program.

“So in terms of sustainability, you basically think that if you build it, they will come?” she asked.

Mr. Coburn suggested that before “building” a program, the EDIC first gauge the level of demand in the community for a small business loan program.

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