May 28, 2020
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Billions in funds strive to keep state steady in rough economy

A couple that owns a concrete curbing company in Old Town is getting $1.7 million. A Rockport animal hospital is getting $1,025,000. A Waterville boat dealer and service yard is getting more than $2 million, and an auto parts sales firm in Hancock County is getting $1 million.

And all of it is public money.

These are among more than 200 businesses in Maine that are receiving federal loans from the Small Business Administration as a result of the American Recovery and Reinvestment Act of 2009. In all, businesses in Maine are borrowing more than $48 million from the administration as part of the federal stimulus program, ac-cording to government data posted at

But that is only a fraction of the bigger federal stimulus funding picture. Billions of dollars are expected to have come to Maine by the end of 2011, more than $2 billion of which is expected to go directly to state agencies to help fund state projects and programs. Millions more are going directly to nonprofit organizations and municipal, tribal and county governments for research, health care, public safety, housing and other purposes.

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Jay Shorette, who co-owns Dirigo Slipform with his wife, Heidi Shorette, said the $1.7 million loan they received from the Small Business Administration as a result of the stimulus act enabled them to purchase the business and its equipment outright from their former partner, Herbert R. Sargent. The Old Town company, which has about 25 employees, specializes in pouring shaped concrete into place without having to let it harden inside fixed molds.

“It’s a lot of money,” Shorette said of the loan that allowed the couple to acquire the entire company last year. “It’s the American dream.”

Some of the larger amounts of money coming to Maine as a result of the act already have received public attention, especially grants going to the state or to nonprofit organizations., which Congress directly mandated and authorized as part of the stimulus act, lists all types of the program’s financial awards, in-cluding grants, loans and contracts.

Information about which businesses are getting the loans or contracts and how much they are getting is listed on the site as part of the federal government’s effort “to foster greater accountability and transparency in the use of funds made available” in the act, according to a statement posted on the site.

SBA loans

According to Small Business Administration officials, the enhanced loan program authorized by the act has been in high demand.

Joan Trudell, communications director for the regional SBA office in Boston, said the number of loans awarded last year by SBA increased by 167 percent and the total value of the loans it awarded increased by 300 percent from the previous year. This is solely because of the federal stimulus program, she said.

“It’s really worked,” Trudell said. “The intent was to stimulate small business lending.”

Trudell said the program has been so popular that in November, SBA ran out of money nationwide to loan to small businesses. Since then, she said, Congress has authorized more money for the program.

As authorized by the act, SBA has waived its fees and increased its level of guarantee for its loans, from between 75 and 80 percent to 90 percent, according to Trudell. SBA’s interest rates, which range from 5.5 to 6.5 percent, have not changed. There is a sunset date for the lending changes permitted by the stimulus program, she said.

“The changes are due to run out in February [of this year],” Trudell said. “It was funded for a year.”

Jeanne A. Hulit, New England regional administrator for SBA, said that the agency stepped in where private lending institutions would not in the wake of the economy’s nosedive. Working with other federal agencies, SBA has increased the percentage of small businesses receiving stimulus funds from 23 to 28 percent, she said.

Hulit said SBA has awarded $5.5 billion in loans nationally as a result of the stimulus program.

“Clearly, loan volume has spiked as a result of these changes,” Hulit said. “It’s been hugely popular.”

Loan recipients

Shorette, co-owner of Dirigo Slipform, said the company did well in 2008, but he knew 2009 would be difficult financially. The prospects of being able to get a $1.7 million loan from a local bank last year, given the state of the economy, were not that promising, he said.

“If it wasn’t for the SBA loan, we wouldn’t have been able to buy the organization,” Shorette said.

Shorette said he and his wife have no immediate plans to expand the business. Their most pressing goal, he said, is to keep it afloat until the economy picks up again.

Jonas Contakos is a co-owner of the real estate on Route 1 where the Camden Hospital for Animals is located. His wife, Stacey Contakos, is a veterinarian who owns the animal hospital business.

Jonas Contakos said that he and his wife bought the business last year with an SBA loan of $1,025,000, which is more than the amount listed for their business at The loan also funded the purchase of a new X-ray machine and some renovations to the building.

Nine people work at the animal hospital, he said, including one person whose position was created since they acquired it. The new hire runs the kennel side of the business and oversees the building renovations.

“None of this would have been possible without the SBA loan,” Contakos said.

Fay Boles, who with his family owns and operates four NAPA auto parts stores in Hancock County, said the $1,007,000 loan his business is getting from SBA is funding the construction of a new, 15,000-square-foot NAPA store on Route 1 in Ellsworth across from Home Depot. The new store, which opened last month, will re-place Boles’ former Ellsworth location, which was about half the size.

Boles said SBA fixed the rate for 20 years, which he wouldn’t have had with a bank loan, and that he hired local contractors to build the store. Among the four stores, Boles employs about 30 people.

“It all went to the contractors,” he said of the SBA loan. “That’s one thing we did was keep [our construction spending] local.”

Frank Prelgovisk, owner of Mid-Maine Marine in Oakland, said he was able to refinance his company’s debt service with the $2 million he borrowed from SBA. The fact that SBA was waiving its fees as a result of the act helped convince him to borrow the money, he said. His boat dealership and service yard employs about a dozen people in the winter and 20 in the summer, he said.

“It really was a good move for us,” Prelgovisk said. “It gave us a much better position for the future.”

Besides the loans from SBA, the U.S. Department of Agriculture is lending more than $200 million to recipients in Maine. Of that amount, $184 million is going to unspecified “multiple recipients,” according to


A little more than $1 billion — nearly 80 percent of the stimulus funding coming to Maine — is in the form of grants, according to information from federal agencies posted at Of that money, state departments such as Transportation, Education, Labor, and Health and Human Services each have received hundreds of millions of dollars while other state agencies have received lesser amounts.

“It will be in excess of $2 billion when all is said and done,” Ryan Low, commissioner of Maine’s Department of Administrative and Financial Services, said about federal stimulus money coming to the state.

More than $400 million is going to boost Medicaid payments to hospitals in Maine, he said, while the state’s food stamp and unemployment benefit programs are getting significant amounts of stimulus funds.

“It really does hit all the way across state government,” Low said. “It runs the full spectrum.”

Low said the federal stimulus money is in addition to the money the state routinely receives from the federal government. It is not regular funding under another name, he said. It is $2 billion that the state would not be getting if not for the act, he said.

Much of the money going to the state is then redirected to subrecipients such as school districts, local governments, nonprofit agencies or public utilities.

Not-for-profit and municipal entities such as research laboratories, police departments and housing authorities also are getting a significant amount of grant money directly from the federal government. In Bar Harbor, The Jackson Laboratory is receiving $8.3 million in grants, and Mount Desert Island Biological Laboratory is getting $6.8 million. The Houlton Band of Maliseet Indians is receiving more than $2.2 million in grants for housing and other programs, and the city of Bangor is getting a total of more than $1.3 million in grants for several programs, according to the Web site. Such totals represent awards granted directly to the recipients by federal agencies and may not include stimulus money that is awarded to the state and then redirected to subrecipients.

The 20 grants given by the U.S. Department of Health and Human Services to Jackson Lab are going to a variety of projects, according to Joyce Peterson, the lab’s spokeswoman. The lab, which employs nearly 1,200 people in Bar Harbor and had operating revenues last year of $166 million, is one of the largest employers in eastern Maine.

Peterson said recently that $2.1 million of the lab’s $8.3 million total in federal stimulus funds is going to expand the lab’s bioinformatic and computational biology programs. The grant will fund additional space for four new investigators and will help fund the purchase of new research equipment.

Stimulus money also will help fund research on the toxic effects of chemotherapeutic drugs and will help develop an ontology or structured vocabulary system for biomedical research, according to Peterson.

“It’s really all over the place,” she said.

More broadly, Jackson Lab will benefit from the stimulating effect that the funding will have on the national biomedical research community, Peterson said. If other institutions are conducting research with mice bred at Jackson Lab, she said, it will help the lab’s revenue stream.

Peterson said the funding has led to recent job creation at the lab, which a year ago had to eliminate approximately 50 positions because of the poor economy. In its most recent quarterly filing with the federal National Institutes of Health, Jackson Lab indicated that federal funds, including stimulus money, have resulted in 13.75 new positions being created at the lab since last fall, she said.


Aside from loans and grants, more than $10 million in additional funds, or less than 1 percent of the total, of stimulus money coming to Maine is in the form of federal contracts. At least two dozen federal contracts have been awarded directly to 16 Maine firms through the stimulus act.

The largest contracts are going to CPM Constructors of Freeport, which has a $4.8 million contract from the Navy to make repairs at Portsmouth Naval Shipyard, and CCI Inc. of Augusta, which has nearly $4 million in contracts from the Federal Aviation Administration to make improvements at an air traffic control center fa-cility in Hampton, Ga.

Only three of the contracted Maine companies are located east or north of Augusta, according to

Roc Caivano, a Bar Harbor architect, has been awarded more than $275,000 in contract funds from the Department of the Interior to lead a project to redesign roadways, signs, outdoor lighting and landscaping at Acadia National Park’s Schoodic Education and Research Center, according to the Web site.

Presque Isle law firm Phillips, Olore, Dunlavey & York has a $17,575 contract with the Army Corps of Engineers to conduct title work. Bowditch & Perkins, an appraisal firm in Skowhegan, has a $9,100 contract with the same federal agency to conduct property appraisals for a possible border crossing expansion project in the northern Aroostook County town of Hamlin.

Terry Bowditch, the sole proprietor and employee of Bowditch & Perkins, said Friday that he appreciates his relatively small contract with the Army Corps. He said he is “sort of” semiretired, living in South Carolina in the winter. He travels to Maine only in the summer to earn his livelihood.

“I would take them all week long,” Bowditch said of such federal stimulus contracts. “I never refuse money.”

For information about the availability of stimulus funds visit

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