Arkansas Capital Corp.: 55 Years and Still Growing

by Mark Friedman  on Monday, Aug. 27, 2012 12:00 am  

Ability to Lend Millions

ACCG has grown into an organization that has the capacity to lend tens of millions of dollars.

“And much of that money is not Arkansas’; it’s money that we’re importing into the state from other places,” Walls said. “Whether they’re tax credits or whether they’re foreign investors or venture capital money that’s coming out of the private [sector].”

Economic developers told Arkansas Business that Arkansas would be worse off without ACCG. “They are invaluable to the economic development efforts as well as to companies and their ability to grow,” said Chesshir. “They’re a very valued partner in our economic development efforts.”

Randy Zook, president and CEO of the Arkansas State Chamber of Commerce/Asso-ciated Industries of Arkansas, agreed.

“For people starting a business who don’t have a lot of resources to begin with, they’ve got to find access to capital and access to markets,” he said. “That’s the help that ACC and each of their entities provide: helping people find the money to create and grow a business.”

Getting Off the Ground

In 1957, an act of the state Legislature created the entity that would become the ACC Group, and allowed the state to lend money to ACC, which at the time was called First Arkansas Development Finance Corp. To get ACC started, $109,500 was raised from 117 individual Arkansans and $923,725 from 35 utilities.

The purpose of the company was to “promote the industries, business, agriculture and general economic welfare of the state through the creation of employment opportunity of Arkansas citizens,”according to a 1960 article by Herbert L. Thomas Sr. in the Arkansas Economist.

Walls said the founders of the company didn’t profit from their investment. “These people came together and formed this entity for the future of the state,” he said. “And they got nothing out of it, no money whatsoever.”

ACC rarely handled any projects in the early days, though. Between 1957 and 1988, it provided $21.6 million in capital that supplemented other funding for projects valued at a total of $44 million.

ACC could have used the SBA to guarantee the loans, but didn’t, Walls said. By 1989, ACC “was somewhat in trouble because it was somewhat inactive,” Walls said.

 

 

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