Forestry Loan Program
VEDA recognizes that Vermont forestry and forest products-based businesses are a vital source of innovation, employment, and economic growth in Vermont and have faced challenges related to unpredictable weather events and changing markets. To help these businesses, VEDA created a special $3.0 million loan program to offer loans up to $500,000 at a subsidized interest rate to meet the working capital and capital-asset financing needs of businesses in the forest products sector. The program is available for up to one year or when the allocated $3 million runs out. Other forestry loans remain available through VEDA’s regular agricultural and forestry loan program.
Eligibility
- Businesses in the forest economy, including foresters, loggers, log truckers, biomass producers, sawmills, firewood producers and wood product manufacturers
- Businesses (sole proprietorships, partnerships, corporations, LLC’s) in good standing with all state agencies
- Loan proceeds must be used for projects located in Vermont and use forest products at least partially produced in Vermont.
Loan Purposes:
- Purchase of capital assets such as vehicles, machinery & equipment, including but not limited to log trucks, excavators, feller bunchers and wood processors.
- Purchase of low impact logging equipment, machinery for implementing AMPs, and equipment, supplies and/or management costs that support soil and water conservation, such as flotation wheels/tires
- Pay operating expenses
- Support seasonal working capital needs
- Refinance existing debt at more affordable rates and/or terms.
Loan Rates and Terms
- Interest rates will be based on VEDA’s fixed or variable Agricultural Loan Rates, as adjusted from time to time, minus 2% for the first five years of the loan. After the initial 5-year period, the rate will adjust to VEDA’s prevailing variable rate.
- The term of loan is based on the useful life of assets being financed, typically up to 10 years for equipment and up to 5 years for working capital lines of credit.
- Consistent with conventional lending practices, loans will be secured by business and/or personal assets.
- The maximum loan size will be based on repayment ability, with the maximum not to exceed the lesser of 95% of the value of the assets securing the loan or $500,000.
- Loans will be guaranteed by any entity or individual who owns or controls 20% or more of the business.
Application Process
- Applicants are advised to discuss their loan needs with a VEDA lender prior to submitting the application. Please contact us at 802-828-5627 or info@veda.org.
- Applications may be downloaded or obtained from VEDA's office.
