City of Des Moines Small Business Impact Loan Program

This article was written by City of Des Moines Economic Development Project Managers, including:

• Breann Bye
• Nick Tarpey

Launching, expanding or scaling a business in Des Moines is an exciting opportunity, but for many small businesses, accessing the necessary capital to bring visions to life can be difficult. Enter the City of Des Moines Small Business Impact Loan Program, a new program designed to provide targeted financial assistance for Des Moines-based businesses that are ready to take a next step but face barriers in securing traditional financing (i.e., from a bank, credit union, etc.).

The Small Business Impact Loan Program offers small-dollar, low-interest, fixed-rate loans to small businesses located within the City of Des Moines that have had challenges accessing traditional financing. These loans are intended for businesses that are ready to expand or launch but may not have access to conventional credit due to factors like limited credit history, lack of collateral or a short business history.

The program provides small-dollar loans ranging from $5,000 to $20,000, depending on the scope of the project. With fixed interest rates set 2 points below the prime rate at the time of loan origination, the program ensures that businesses can access affordable financing for a variety of needs.

Repayment periods for these loans will vary, typically ranging from 3 to 5 years (depending on project size), and the program has been allocated $100,000 in total funding for this round. Between 5 and 20 loans will be originated in this funding cycle.

The City of Des Moines is generally looking for businesses that have strong business plans and a clear vision for growth within the city. However, to be eligible for the Small Business Impact Loan, applicants must meet certain requirements, including:

• Brick and Mortar Location
  • The loan is available to small businesses located within the city limits of Des Moines only. Home-based, pop-up or otherwise mobile businesses are not eligible for this program, unless they are using program funds to scale into a brick and mortar space. Businesses currently not located in a brick and mortar space and looking to scale into one must be able to provide an executed lease or mortgage agreement that demonstrates a legitimate, verifiable brick and mortar location at the time of their full application submission. All areas of the City are eligible for this program, except businesses located within InvestDSM Special Investment Districts.
• Lack of access to “traditional” financing sources:
  • Applicants must demonstrate a lack of access to traditional funding such as a loan or line of credit from a bank or credit union. This could be due to limited credit history, insufficient collateral, a short business history or other barriers that prevent businesses from obtaining funding from a conventional lender. Some sort of “denial of financing” communication from a financial institution (email, formal letter, etc.) is required to be included as part of the full application for this program. “Partial” denials (i.e., an institution wouldn’t fund the entire requested amount but would be comfortable funding a portion with the City as an additional funder to fulfill the entire loan request) are an acceptable form of denial (more information below in “eligible uses” section).
• Have a “project”:
  • Businesses must propose to use City funds from this program for a specific project. Funding will not be awarded for working capital and operational expenses such as rent, utilities or payroll. Funds also may not be used for refinancing or as a reimbursement for already-performed work. “Projects” can be physical, like an interior renovation, tenant build-out or site improvements, but also “soft,” such as a website build, marketing campaign or design costs.
• Business Size/Type:
  • Businesses must have fewer than 20 full-time equivalent (FTE) employees and must be legitimate and registered. New or existing businesses are eligible to apply (this program does not have a “business history” requirement). See below for a list of ineligible business types.

Ineligible Business Types

While the Small Business Impact Loan is designed to support a wide range of industries, some businesses are ineligible for the program. These include:

• Liquor and tobacco stores
• Adult entertainment businesses
• Pawnshops, payday loan, and check-cashing businesses
• Vehicle sales, gas stations, car washes
• Gaming or gambling parlors (includes “fish games” and similar)
• Chain stores
• Home-based businesses (unless scaling to a physical location)
• Pop-up or mobile vendors (like food trucks)
• Junk/salvage operations
• Self-storage facilities
• Schools and religious institutions

Eligible Uses for Loan Funds

• Building renovations (both entire building and tenant buildouts): Full-scale interior building renovations (interior demolition, structural stabilization, roof work, window replacement, plumbing, mechanical systems, grease interceptors, etc.). Smaller projects such as counter installations, flooring, drywall installation, painting, etc. are also eligible for funding from this program.
• Exterior site improvements: Fencing, landscaping, paving (for parking lots, sidewalks, patios), signage, and curb/concrete work. Parking lot and sidewalk upgrades will be considered eligible for funding only if required per City Site Plan requirements. Fencing projects will be considered eligible for funding only if fencing is required per City Site Plan requirements.
• Equipment and inventory: Purchase of new equipment, fixtures, furnishings and inventory.
• Professional design services: Fees for design services procured from architects, landscape architects, engineers that are intended to produce site plans, building permit drawings and landscaping plans.
• Marketing and website development: Funds can be used for marketing campaigns or the development/design of a website.
• Real estate acquisition: For businesses that need additional gap financing to purchase property as part of their growth plans.
• Gap financing: Loan funds may also serve as gap financing when other sources of funding are insufficient. The City of Des Moines encourages leveraging of other dollars to be included in this program. For example, if an applicant requested a loan for $50,000 from their business bank and was partially denied, with the bank saying they would only lend up to $30,000 for a particular project, the City would be comfortable acting as a “gap-filler” and could lend the remaining $20,000 to make the loan “whole.”

Application Process

Step 1: Pre-Qualification Form

To get started, all applicants must submit a Pre-Qualification Form. This form helps verify project eligibility before businesses invest time and resources into submitting the full application. The Pre-Qualification Form can be conveniently submitted online via the City of Des Moines Customer Self-Service (CSS) website.

• Pre-Qualification Period: Now through Friday, Feb. 28, 2025
• How to Submit: Log in or create an account on the City’s CSS website (see “Login or Register” in top right corner of website’s home page), select ‘Apply,’ then search for ‘Small Business Impact Loan Pre-Qualification’ and follow the prompts within the digital form to submit the necessary information.
• Once Submitted: City staff will reach out to you via phone or email to confirm Pre-Qualification Form receipt and will verify if your business and project are eligible for the program and if you should proceed with submitting a full application.

Step 2: Full Application Submission

Once pre-qualified, applicants must submit a complete application. The application is one for a loan and therefore requires a mix of business and financial documentation, including:

• Business plan
• Financial projections
• Profit and loss statement (for existing businesses)
• Cost estimates/quotes/justifications for project costs
• W9 information
• Two years of tax returns
• Personal financial statement
• Verification of business structure/formation
• Verification of business location
• Verification of other funding sources (if applicable)
• Personal guarantee
• Proof of business insurance
• Experience verification (resumes or similar narrative)
• Good Neighbor Agreement
• Demonstration of lack of access to traditional funding sources (e.g., a bank denial letter)

Note: This program DOES NOT require collateral or have a credit score minimum.

All of the program materials, such as the guidelines, scoring rubric, actual application form and materials checklist, can all be found on the program website, dsm.city/impactloan. Also from the website, prospective applicants can download templates that will assist in crafting various portions of the required application, such as:

• Business plan template
• Cashflow projections template
• Personal financial statement form
• Profit and loss statement template
• Good Neighbor Agreement template

How to Submit: Email oed@dmgov.org to notify us of your interest in the program. Breann or Nick will then reach out to you directly to learn more about your project and provide instructions on submitting a full application. Be sure to mention your business name, location, and proposed project in any emails to us.

The application window opened on Feb. 1, 2025, and closes on Friday, Feb. 28, 2025.

Step 3: Review and Scoring

After the application period closes, a committee composed of City of Des Moines staff and community members will review and score all applications based on a pre-determined set of criteria. This review process will take place in March 2025.

Step 4: Notification

Applicants will be notified of funding approval or denial by late March or early April 2025.

Key Dates to Remember:

• Friday, Jan. 3 to Friday, Feb. 28, 2025: Pre-Qualification Form submittal period
• Saturday, Feb. 1, 2025: Application window opens
• Friday, Feb. 28, 2025: Application deadline
• March 2025: Application review and scoring
• Late March/Early April 2025: Notification of funding approval or denial. Funds will be disbursed around this time (after finalization of contracts), and loan recipients should expect to begin repaying loans one month after receipt of funds.

Please note that these dates may be adjusted as necessary by the City of Des Moines.

Why Should You Apply?

The Small Business Impact Loan Program is more than just a funding source — it’s an opportunity for small businesses in Des Moines to grow, improve and contribute to the overall vitality of the local economy. Whether you’re looking to renovate your storefront, purchase new equipment or launch a marketing campaign, this loan program can provide the financial flexibility and support you need.

By offering affordable financing with low-interest rates and favorable repayment terms, the City of Des Moines is helping businesses overcome barriers and unlock their full potential.

If you are a small business owner in Des Moines with a clear vision for growth and a need for financial assistance, the Small Business Impact Loan Program could be the resource you’ve been looking for. Take the next step by reviewing the program guidelines, preparing your application materials and submitting your Pre-Qualification Form today to get started.

Any Questions?

If you have questions or need assistance with the application process, feel free to reach out to the City of Des Moines' Small Business Support Center Staff.

Author Profiles

	Breann Bye Breann Bye is an Economic Development Project Manager with the City of Des Moines. She is about to celebrate her first year of employment with the City after previously serving as the Executive Director of the 6th Avenue Corridor, a Main Street organization. An Iowa native, Breann is a proud resident of Des Moines' River Bend neighborhood. You can reach Breann at bbye@dmgov.org.
	Nick Tarpey Nick Tarpey is an Economic Development Project Manager with the City of Des Moines and is in his fourth year of employment with the City. Previously, he was employed in the City's Planning and Urban Design Division. A Central Ohio native, Nick now calls Downtown Des Moines home. You can reach Nick at notarpey@dmgov.org.

The Greater Des Moines Partnership celebrates the Greater Des Moines (DSM) entrepreneur community and helps small businesses succeed with one-of-a-kind resources and opportunities for networking. Find out how other entrepreneurs have found success by reading their stories and attending local small business events in the region.