Returning to his rural hometown in southwestern Colorado to care for his mother and to find a better quality of life, Frank Lister was a man without a job in a tight, small-town economy.

A former mountain bike guide and business owner, Lister developed a start-up business idea to create thematic maps with a southwestern backdrop. With good credit but no collateral, Lister was turned down for a business bank loan. He turned to the former Montezuma Small Business Initiative Program for help with a moderate loan.

Now eight years later, Lister’s Time Traveler Maps is a successful business located in Mancos helping to promote the southwestern region.

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With the idea of establishing similar business initiative mechanisms for growing more rural Colorado small businesses, civic and business leaders from Glenwood Springs to Rifle attended a March 12 workshop at Rifle City Hall aimed at learning how to assist entrepreneurs.

The “microenterprise” presentation was part of a series of economic development workshops developed by the Small Business Development Center at Colorado Mountain College.

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During the presentation by Kersten Hostetter, executive director of the nonprofit Micro Business Development Corporation in Denver, area leaders learned the ins and outs of community-based loan funds where small, local entrepreneurs can try for funding when they cannot qualify for traditional business loans through banks.

Developing a successful community-based loan program is one key for economic development on the Western Slope, said Joe Livingston, SBDC director in Glenwood Springs.

The loan program is “critical in terms of commercial areas in our communities trying to develop and go in a direction we would like,” Livingston said.

“If you want to build a healthy, sustainable economy, you create local businesses and you nurture your own.”

Livingston said his busy center sees promising individuals each month who wish to become self-employed or set up an in-home business but do not have the capital to get started.

Successful locals helping nurture other complementary business is key to the community loan concept, which is funded on several levels by community investors. Business applicants to the program can use the funds for start-up businesses, introductions of new services, seasonal needs, income patching or business improvements such as technology or signage.

Some examples might include landscapers or caterers needing marketing funds to advertise before their busy season, stay-at-home moms who want to become independent cosmetic consultants, or workers starting a cleaning service.

Glenwood Springs City Councilwoman Jean Martensen said the city’s Downtown Development Authority is exploring the possibility of using a community loan fund for the design portion of a Main Street program to remodel the facades or interiors of existing downtown businesses. She said downtown businesses will need to work to attract and retain customers in light of a new large marketplace planned on the west side of town.

Rifle Area Chamber of Commerce Executive Director Richard Klingler said he sees a “definite need” and great possibilities for a community-based loan fund helping Rifle area entrepreneurs.

“I’m particularly interested to help attract new, non-competing merchants to our merchant mix,” Klingler said. “This would be a tool to help attract and be able to offer a loan source for relocations or expansions of existing or start-up business. We see a need for a lot of home-based business opportunities to get established financially and progress to mainstream financing.”

“You can’t lose if you are out there helping businesses in ways that banks can’t supply funds,” noted Marcia Kent, president of the Rifle chamber board and of Wells Fargo Bank in Rifle.

Business leaders also are excited about trying to establish an area loan fund to increase the business base in Silt. Glen Ault, chair of the Silt Revitalization committee, said community investors have expressed a strong interest in helping grow new businesses.

The innovative community loan program can start with loans as low as $500 or go up to $30,000 borrowed through a regional community loan pool. Loans at lower levels are established through “peer lending” programs that are guaranteed with “social collateral” or character loans.

Groups of three to five new business owners act as guarantors for fellow entrepreneurs who may start out with good business plans but traditional financing is out of their reach due to lower credit scores, little collateral or limited business experience.

Program participants have access to low-interest loans, technical assistance and business advice through community involvement. Hostetter said she already has a list of names of investors in the area who wish to become involved and volunteer their time.

Organizers say the consensus opinion following the seminar in Rifle was positive, and follow-up meetings are planned for later this spring to try to form a regional project.

“This makes sense for the area,” Hostetter said. “It is a viable initiate to create a grassroots project that will strengthen new and existing small businesses on the Western Slope.”

For more information on the community-based loan funds program or other Small Business Development Center community development workshops, visit http://www.coloradosbdc.com or call Joe Livingston at 800-621-1647.