Bridge loan to keep Rockford’s Crust & Crumbles baking amid pandemic

Jeff Kolkey, jkolkey@rrstar.com

ROCKFORD — Jojo Gendenbaatar of Crust & Crumbles on Tuesday will be the first small business owner here to close on a special bridge loan that could help her bakery stay alive until the coronavirus pandemic passes. A staff of four — down from eight before the pandemic and its accompanying stay-at-home order — is working at Crust & Crumbles, producing artisanal sourdough breads and laminated pastries for customers to pick up on Thursdays and Saturdays. Amid the COVID-19 outbreak, Gendenbaatar said the loan should allow her to pay her utility bills, insurance premiums and vendors for three months until a 3.75% federal disaster relief loan, with a term of up to 30 years, comes through. “We need it for paying our vendors; we need it to continue to meet payroll and just working capital, really,” Gendenbaatar said during a phone interview. “With us shutting down, we are just doing curbside pickup two days a week. It’s definitely not the same as being open five days a week and one of the great things about the loan is that your lenders and your landlord have to agree to a deferment at least through the period of the shelter in place.” Crust & Crumbles is among more than two dozen area businesses taking an emergency bridge loan through the program. Those loans, a lifeline until federal help arrives, are expected to close within nine days, accounting for about half the available loan pool. After getting her start at the Rockford City Market in 2010, Gendenbaatar in July opened Crust & Crumbles at the Indoor Market, 116 N. Madison St. Things were going well until the coronavirus pandemic struck. Each week of the shutdown, Gendenbaatar works with her team to produce a menu of breads and croissants to offer. Customers must order ahead of time on her website. On pickup days, team members deliver the items to customers in their cars at curbside. Her workday usually starts at midnight, and she makes her sourdough breads with all organic, non-GMO flour. They take nearly 72 hours to produce. They are made from a “mother” culture of naturally cultivated yeast used to bake every loaf. The mother culture is constantly fed with water and flour, giving her breads their unique character. The mother culture can produce yeast indefinitely. The city of Rockford teamed with local banks led by Illinois Bank & Trust, Sunil Puri of First Midwest Group, and the Rockford Local Development Corp.’s Northern Illinois Development Corp. to create a $2 million emergency bridge loan pool. The money is going to small businesses like Crust & Crumbles that have been hit hard by the stay-at-home order. The loans are meant to keep qualifying small businesses in Winnebago County afloat until disaster relief funds are released. More of the loans remain available, said RLDC CEO John Phelps. There are other federal forgivable loans that Phelps believes local businesses should seek in addition to the emergency and disaster relief loans he is working on. While those loans are forgivable, they are also more limited. Phelps said the disadvantage is that to qualify for forgiveness, 75% of the money must be spent on payroll. Although disaster relief loans through the U.S. Small Business Administration must be repaid, the loans are at a low rate and offer long-term repayment plans, making them an attractive deal given the circumstances. Phelps said they give business owners the flexibility to spend the money on all sorts of business needs. Jeff Kolkey: jkolkey@rrstar.com; @jeffkolkey

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The Rock River Development Partnership (RRDP) was established in 2009 as a 501c3 organization. The RRDP brings businesses and people together to create place. We are entrepreneurial and experiential market makers. Our strategies are to create connections between local entrepreneurs and customers to drive economic development to Rockford’s urban core and historic commercial districts, and to foster vibrancy through the activation of storefronts, placemaking and tourism.

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