growing the green economy

Sustainable Business Center Proposed in Missoula

By Kaylee Porter, 7-02-08

The Sustainable Business Center, a nonprofit that would house close to 20 local green building and sustainable living companies, hopes to set up shop on Russell Street in Missoula.

These types of businesses are often small and undercapitalized, explains Rick Wishcamper, founding partner of the Rocky Mountain Development Group, which is organizing the project and purchasing the property. The Sustainable Business Center’s aim would be to strengthen them.

“It will grow the businesses that grow the green economy,” Wishcamper said.

For starters, the center would give these businesses an easily accessible, central location. Currently, many of them are in low rent areas around town that customers seldom frequent. The almost 15,000 square foot campus on the high-traffic corner of Russell and Wyoming Street would give the businesses a higher profile, and its proximity to several low-income housing projects, the Good Food Store and a proposed bike trail make the location ideal for a center offering sustainable building options, Wishcamper said.

The Sustainable Business Center, should government funding come through, would also be able to charge the businesses rent reduced 20-25 percent below market prices.

“It would allow them to spend what they would otherwise spend on rent on investing and growing their business,” Wishcamper said.

Among the businesses that might benefit is Home Resource, a nonprofit recycled building material center. Since opening in 2003, they estimate they have recycled over 2,000 tons of building materials.

“One of the things people complain about is that green building is elitist,” Wishcamper said. “Well Home Resource, using recycled building materials has provided a very inexpensive, egalitarian way of building green.”

Matt Hisel, co-director of Home Resource, says they are excited about being a part of the Sustainable Business Center and they expect it to help their business.

“We would be in a prime location that is close enough to the heart of town to serve our current customer base and also gain visibility to attract new customers,” Hisel said. “Being in a center that houses multiple green business, all the businesses would benefit by sharing a customer base. We would be able to advertise together and promote each other.”

Whether or not the Sustainable Business Center becomes a reality, however, depends on securing multiple sources of financing, Wishcamper explains.

This is an almost $6 million project, and the financing Wishcamper is referring to is fairly complicated. (To see a project summary, click here). It aims to bring together a grant from the Economic Development Administration, a HUD 108 loan, New Market Tax Credit and private funds provided by Wishcamper and his partners.

The EDA grant would contribute $1 million of federal money to the project. The HUD 108 loan, which is also federal money, would make up the bulk of the project, providing $3.3 million dollars. 

The HUD loan would allow the city to borrow five times our Community Development Block Grant (CDBG) allotment with the provision that if it defaults we forfeit five years of CDBG funding.

(The Community Development Block Grant, a U.S. Department of Housing and Urban Development program, gives money to more than 1,180 local and state governments—a total of $4.7 billion in FY2005. Missoula, an “entitlement community,” received about $600,000 from the program in fiscal year 2008.)

“That’s the risk the city is taking here,” City Councilman Bob Jaffe said. “If it goes bad our CDBG allocation is what’s backing this loan so we want to make sure something is backing our loan too.”

Jaffe says the appraisal of the proposed Sustainable Business Center is well above the loan amount, however, so if something were to go wrong the city would be able to recoup its investment.

In order for the HUD loan to be a possibility for this project, however, the city must make changes to its growth policy to allow for this type of loan. This will be addressed at a public hearing on Monday July 7.

“There is another piece to this also,” Jaffe said. “That HUD 108 fund is a revolving fund and to have access to it you basically have to have a project that starts it. Then we would perpetually have an allotment of over $5 million available to us. This project is breaking the ice on access to this new money.”

Wishcamper says the Sustainable Business Center will help create new jobs as well. More importantly, though, he says, is that if this sort of center is not created, national chains, like Wal-Mart and Lowes, will capitalize on the momentum of the environmentally friendly building movement, driving out local entrepreneurs

“We have the opportunity with this project to incubate local business as opposed to leaving them exposed to the forces of the market,” Wishcamper said.

Jaffe also sees the Sustainable Business Center as a way to help the local economy while encouraging sustainable living.

“We’re all trying to come up with ways to develop a more sustainable society and promoting the organizations and business that are in that business is how we are going to get there. A lot of these places, like Home Resource, that reuse building materials are good for our community. It saves people money and it’s good for the local economy and the environment. Promoting these businesses and making them work better for the community helps us all,” Jaffe said.

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