Natural Capital Investment Fund Works to Help Economy, Environment

By CATHY BONNSTETTER
For The State Journal
July 11, 2008
(Reprinted with permission)

SHEPHERDSTOWN — On any given workday Natural Capital Investment Fund, or NCIF, executive director Marten Jenkins may discuss how to market hot dog chili to a Piggly Wiggly, the most efficient way to tear down a circa 1900 barn, federal regulations for processing goat milk or the definition of a green roof.

Jenkins’ job is to help entrepreneurs make a go of their businesses while boosting a rural area’s economy and protecting the environment.

“We call it the triple bottom line,” he said. “Our goals include social, economic and environmental benefits. Our program is about using our network to bring resources to small businesses. We focus on natural resource based businesses, sustainable tourism and value added agriculture.”

The NCIF, a Conservation Fund program, is the only non-profit environmental program with a dual charter to encourage community development as well as traditional water and land conservation.

The fund’s area includes economically distressed portions of Tennessee, North Carolina, West Virginia and Virginia. A certified community development financial institution, the NCIF works closely with the Appalachian Regional Council and uses its guidelines to determine a community’s eligibility to participate.

The NCIF loans between $10,000 and $250,000 to its clients.

“Our role is stop gap financing,” Jenkins said. “We use our money to leverage other money to fund projects that are almost bankable. If the bank says this is a great person with a great product, but they have a collateral issue, we can help.”

Their funding decisions are made by an eight-member investment committee.

“That committee is the first set of eyes to review applications, and between the committee and our board of directors, we have about 200 years of lending experience represented,” Jenkins said. “Their experience is invaluable.”

The NCIF funds expansions, as well as start-ups. Jenkins says the NCIF has about 20 projects. The fund’s sources for financing include the USDA Rural Development Program, the Claude Worthington Benedum Foundation and the Calvert Foundation. The ARC has provided about $600,000 in funding for the NCIF since the fund began in 1999.

“The NCIF’s financial support for their clients represents only about a third of what they bring to the table,” said ARC manager Ralph Goolsby. “The unique piece that they bring is their capacity to work with businesses and provide technical assistance — anything from financial management to operational management.”

The NCIF uses grant money to provide approved entire areas with business workshops and works with their individual projects on whatever is keeping them from being efficient and profitable.

“One of our businesses in Renick, The Crazy Baker, has an all-natural recipe for caramel sauce that they want to ship,” Jenkins said. “It separates so they have to freeze it. We are looking for a food scientist to help them add another all- natural ingredient to stop the separating so they will not have to spend a lot of money on packaging.”
In the same tiny town, the Petre family, owners of the Renick Millworks benefited from the NCIF’s technical and financial assistance.

“They helped us with marketing and designing new brochures,” said Jay Petre, who owns the millworks with his brother and father. “They also acquired grant money to send us to flooring school.”

While providing capital and technical assistance the NCIF is careful not to duplicate services their clients can find elsewhere.

“Our program is about using our network to bring resources to small businesses,” Jenkins said. “The challenge is connecting the dots and bringing some of our capital. We help fund locally grown businesses.”