A new credit union is hoping to fill a funding gap in Maine for small scale, sustainable farming and food production.
Called Maine Harvest, the credit union is in a final fundraising push to reach a $2.4 million capitalization, at which point it can apply for a charter. It is expected to open in early 2019.
The arrival of a new credit union may seem a bit of an anomaly amid a long-term decline in credit unions and community banks. “It’s like a Shaker having a baby,” says Scott Budde, one of the founders of Maine Harvest Credit Union, referring to the celibate Christian sect.
Budde and his partner, Sam May, both seasoned financial professionals, see a local financing opportunity they believe a credit union is uniquely suited to address.
Funding the Local Food Economy
The local food economy in Maine is growing, with small producers churning out cheese, cider, craft beer and organic produce to meet local demand. Like small farmers and producers everywhere, however, their biggest challenge is cobbling together funding.
Groups like No Small Potatoes, a local citizen-led investor group and Slow Money offshoot, provide small loans to local producers of up to $50,000. The state is also home to one of the nation’s top CDFIs, Coastal Enterprises, Inc., which makes a variety of loans and investments. And bank or government financing is often available for large-scale projects that fit established models, like industrial scale farms.
But research suggests that plenty of food producers are falling through the cracks. Small famers have a difficult time securing land, and many small producers complain that conventional lenders don’t understand the nuances of their business. The organizers behind Maine Harvest have identified $460 million in potential loan demand among Maine farmers and producers.
Maine Harvest will focus on land-backed mortgages of up to $400,000, small-business loans of $60,000 to $125,000 and equipment loans of $20,000 to $40,000. […]
The post A New Credit Union in Maine Will Fund Sustainable Food and Farms appeared first on Locavesting.
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