As published in the February 1, 2011 Toledo Business Journal
Lisa Wagner,
Toledo-Lucas County Port Authority
Port bond fund assists job growth
Toledo Business Journal recently interviewed Lisa Wagner, Toledo-Lucas County Port Authority director of financing programs. She shared the following thoughts.
Toledo Business Journal: The Toledo-Lucas County Port Authority makes loans to area businesses from a bond fund that it manages. Can you describe this fund and its background?
Lisa Wagner: The bond fund was created in 1988. It was created for the intention of providing a different financing tool than what was conventionally and typically offered at a bank.
The bond fund provides long-term fixed rate financing for fixed assets.
TBJ: In 2010, a grant was given to the fund from First Energy and the Ohio Manufacturer’s Association (OMA). What was the amount and purpose of this grant?
LW: The Toledo Port Authority received a $2.5 million grant from the OMA and First Energy. In total, the OMA and First Energy granted $7.5 million to three Ohio Port Authorities – Toledo, Cleveland, and Summit County – for the purpose of increasing economic development in Ohio.
The OMA, First Energy and the three Ohio Port Authorities are working together to reach out to manufacturers in Ohio to market the bond funds and increase employment in Ohio.
TBJ: Can you discuss opportunities to increase economic development from this bond fund?
LW: Currently, the Port Authority is working with the OMA on the marketing efforts to its membership. Also, the Lucas County Improvement Corporation (LCIC) has launched a business retention reach program (the Business Outreach and Assistance Program), for which they’re reaching out and making retention calls. We’re teaming up with them.
Internally, we’ve added another staff member to try and increase our marketing efforts and are looking at adding another staff member. In the environment that we have – where the banks are kind of pulling back on a lot of lending – we’re seeing this as an opportunity to increase our lending.
TBJ: Can you explain the benefit of the new grant money as it involves the reserves and credit rating of the fund?
LW: The Port Authority currently has a triple-B (BBB) rating from Standard & Poor’s (S&P). That $2.5 million is in a series of reserves. Those reserves are available and on deposit so that, if and when there are defaults that are not cured on their own, then we look to the reserves. But, the rating that we get from S&P is based on the amount of reserves that we have.
TBJ: What has been the bad debt history of this bond fund?
LW: We’ve had a couple of defaults, but they’ve cured themselves, so we’ve never had to touch the reserves.
TBJ: For what purposes can a business use the loan proceeds from this fund?
LW: They can use it to finance any fixed assets – land, building, machinery, and equipment.
TBJ: How many loans has the Port Authority made through the fund? What is the dollar amount that has been lent?
LW: There have been 56 bond issues in the fund since 1988. That has totaled $202,605,000.
TBJ: Are there any other issues you would like to discuss?
LW: The Port Authority’s main interest in establishing this program and our other loan programs is to work with businesses to try to provide something that they can’t get from their banks. We’re encouraged by the job creation and growth that spurs from the opportunities that we’re involved in and really see the relationship that we have with the businesses that we work with as a partnership. We really value that.