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Michigan helped Frank Kestler (right) secure a loan to transition his auto supply business to one that makes environmentally friendly machines that clean steel.By Catherine Clifford, staff reporterAugust 24, 2010: 5:48 AM ET NEW YORK (CNNMoney.com) — Many state programs that help small businesses get loans they need to survive or expand are in jeopardy, victims of the economic downturn and state budget gaps. The programs — in dozens of states from Vermont to California — cost relatively little to run, are remarkably successful and create jobs. Massachusetts’ program has been running for 17 years and has made almost 4,300 loans. Indiana kicks in more for loans that will lead to high-paying jobs. The loans are a lifeline at a time when small businesses are still struggling to get credit from banks. In the last two years, $40 billion worth of bank loans has evaporated, according to bank reports submitted to the government. But many of the programs, which marry private lending with state dollars, are running out of cash, and states can’t afford to shoulder the burden on their own. "I don’t have a lot of hope that there will be more money available at the state level," said Greg Main, CEO of the Michigan Economic Development Corp., which operates a couple of highly regarded state capital access programs. The states and President Obama have been lobbying Congress for help. Tucked in a $40 billion small business bill, the $1.5 billion State Small Business Credit Initiative hasn’t gotten much attention. It’s a small provision, but it could be a game changer. The bill has been stuck in Congress for months. Lawmakers are planning to take it up when they return next month. States backstop loans: Michigan has one of the most innovative loan programs, but it’s nearly broke. The Supplier Diversification Fund helps manufacturers get access to financing to transition into growing industries like alternative energy, medical products and defense equipment. In addition to looking at borrowers’ profit streams, many banks require collateral like real estate or equipment to back loans. as the recession dragged down the value of such collateral, manufacturers have been all but shut out by banks. Michigan’s diversification fund helps bridge the gap: The state puts money in the bank to offset the company’s depressed profits and the depreciated value of a business’ assets. as the business pays back the loan, the value of the collateral recovers, or the profit stream improves, the bank releases the funds back to the state. The program started with just over $26 million from the state and so far, $17 million has been committed. "Our queue is growing exponentially by the day," said Paul Brown, vice president of the Capital Access and Business Acceleration group in Michigan.

"we have something like 50 that are in the final stages of the loan application and hundreds more inquiries that are just beginning the process." The fund has helped Mark one Corp., which has been supplying machines that make automotive parts since 1972, reinvent itself. Five years ago, the Gaylord, Mich.-based company began work on an energy efficient process to clean steel. GreenCleen just started to hit the market when the recession hit with full force. "Many manufacturers in Michigan, in the Midwest and around the world, particularly automotive capital goods, were really harmed by this," said Frank Kestler, majority owner of mark one. Mark one got a $2 million loan, with about half coming from the state fund, and has so far sold three of its multi-million dollar GreenCleen machines. If a business defaults on the loan, the bank keeps the lion’s share of the state’s money. However, to date, Michigan has never had a loan default with the collateral support program: Both the bank and the state have an incentive to make the loan to only the most worthy businesses. "this isn’t throwing money down a hole and hoping something happens," said Kestler. "it really builds on what is already there, just providing transition money that is going to be paid back." Jobs are the bottom line: Small businesses are powerful job generators, but they need access to capital to grow and create those jobs. Saline, Mich.-based Saline Lectronics assembles electronic circuit boards, and the company developed a niche by going after the middle-sized orders that demand more advanced assembly. Saline Lectronics outgrew its facility in 2009 but was unable to get a loan to expand because of the decreased value of its commercial real estate. The state put up about half the value of the loan, and the bank put up the rest. "Without the state of Michigan’s participation, this transaction would not have been done," said Mario Scriberras, president and CEO. Since getting the loan, Saline Electronics has grown by about 30 employees. There are hundreds more manufacturers in Michigan alone that could benefit from the lending program. But without help from Uncle Sam, the Michigan program is at the end of its rope. "Our collateral support program will most likely cease to exist because we won’t have the resources for it," said Brown.   Small business loan programs need cash ASAP

SAN FRANCISCO—If the San Francisco sheriff's plan becomes reality, illegal immigrants arrested for petty crimes won't be held in jail longer than necessary, even if federal immigration agents may want them detained for possible deportation. Instead, starting Wednesday, deputies will treat those eligible for release just like U.S. citizens: They will be cited to appear in court. City officials, however, aren't so sure about Sheriff Mike Hennessey's plan. The new policy is his attempt to comply with a city law that prevents police from aiding federal authorities in non-felony crimes and a U.S. law that requires authorities to share fingerprints with immigration agents. "I'm in a position where I'm trying to enforce a local law as well as not violate the federal law and this is the 'in-between,'" he said. "It's a difficult area to tread on because emotions run very high here in California and throughout the country on immigration issues." Under Hennessey's policy, illegal immigrants who commit misdemeanors, such as disorderly conduct, trespassing or shoplifting, will not be held while the U.S. Immigration and Customs Enforcement (ICE) checks their status through a fingerprinting monitoring program. Hennessey said the change is meant to coincide with the city's "Sanctuary City" law, which aims to provide refuge for illegal immigrants. Mayor Ed Lee's office did not receive advance notice of the policy change, said Christine Falvey, Lee's press secretary, in a prepared statement. "We have reached out to federal authorities to determine if this new policy contradicts federal law," Falvey said. "We are awaiting clarification." The sheriff's new policy comes as the California Assembly on Thursday approved a bill to revise the state's agreement on using the federal Secure Communities program. The measure, which would allow counties to opt out, now moves to the state Senate. San Francisco and nearby Santa Clara county have sought permission from the federal government to opt out of Secure Communities. Hennessey said his policy is similar to San Miguel and Taos counties in New Mexico. He said San Francisco's policy will protect public safety because immigrants would be more willing to report crimes if they didn't fear arrest and possible deportation. ICE Spokeswoman Virginia Kice said Hennessey's decision is "unfortunate." In San Francisco County, ICE has taken custody of 731 deportable immigrants since Secure Communities began in June 2010, Kice said. Nearly 40 percent had prior criminal convictions for felonies or multiple misdemeanors, she added. Angela Chan, an attorney with the Asian Law Caucus and a San Francisco Police Commission member, said 68 percent of the people deported under the Secure Communities program in California did not commit serious crimes. "That puts a lot of people at risk," Chan said. "That's why there's such uproar over this program." Hennessey said he learned that keeping immigrants with ICE detainers behind bars is a courtesy and not mandatory after meeting with Secure Communities director David Venturella late last year. Hennessey's move is drawing some sharp criticism. "The borders will never be secure as long as places like San Francisco lay out the welcome mat," said Tom Fitton, president of Judicial Watch, a Washington, D.C.-based legal advocacy group that is suing the city over similar immigration issues. "These policies put illegal immigrants above the law," Fitton said. Fitton cited a 2008 incident in San Francisco where three members of a family were shot to death by a gang member who was an illegal immigrant and had been released from custody as a juvenile. http://www.mercurynews.com/breaking-news/ci_18171178?nclick_check=1

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General Interest, 1924 Certainly the most successful third party in the immediate post-World War I era was the Progressive effort led by Senator Robert M. La Follette of Wisconsin. The end of the war had seen an upsurge in left-wing political activity in the United States, as evidenced in the growth and development of the Workers’ Party (the Communists), the Socialist Party and the Farmer-Labor Party, all of which increased their ranks at the beginning of the 1920s. Also making an impact at this time was the Conference for Progressive Political Action (C.P.P.A.), which in 1922 merged the efforts of several railway unions into a surprisingly effective state and local political force. They successfully backed a number of liberal candidates in Congressional races and had visions of greater success in 1924. The C.P.P.A. held a national nominating convention in Cleveland, Ohio, that year and concluded that their best hope of gaining real influence would come through backing a candidate with a national reputation. La Follette fit the bill, but he was leery of Communist influence in left-wing political parties and styled himself an Independent. He was, however, enticed to accept the Progressive nomination by being given full control over the party platform and the choice of his running mate. The C.P.P.A., in many ways heir to the defunct Bull Moose or Progressive Party of Teddy Roosevelt, offered a platform in 1924 that was only marginally more socialistic than the statement issued a dozen years earlier. La Follette called for: * Government Ownership. Citing mismanagement by private enterprise, the Progressives called for government ownership of the nation's railroads, timber forests, coal, ore and oil fields, and power-generating water resources. * Tax Reform. Arguing that the middle and lower classes shouldered a disproportionate amount of the tax burden, the Progressives called for a lowering of tax rates for those groups and sharp increases for the wealthy. * Agricultural Reform. Support was voiced for a variety of government programs designed to relieve the distress of American farmers, who were contending with the related problems of overproduction and low prices. * Judicial Reform. The Progressives argued that middle class and working Americans were harmed by overactive courts that overturned the legislative efforts of a well-meaning Congress and state assemblies. Limitations were urged on judicial review and on the use of injunctions. The Socialists, Farmer-Labor Party and a variety of labor organizations climbed on board with La Follette, which broadened the movement into what was generally termed the Progressive Party. The Workers’ Party offered its support, but was turned down. In the November election, La Follette polled nearly five million votes and carried his home state, but was easily outdistanced by the major parties. The Progressive Party unraveled quickly following the election defeat in 1924, but it staged a comeback in the 1930s on the state level in Wisconsin where La Follette’s sons, Robert Jr. and Philip, forged a successful movement that lasted until the end of World War II.

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