Loan Program to Aid Technology Industry

Laid-off defense workers could benefit from a new low-interest loan program designed to feed $4 million into the struggling Los Angeles County technology industry.

About 60 people, many laid-off engineers from large Southern California defense companies, have applied in the first week of the program, said Lance Stevenson, administrator of the program for the nonprofit Business Finance Center.

The program--funded by $3 million from the federal Economic Development Administration and $1 million from the Los Angeles County Community Development Commission--seeks to help professionals start small businesses, he said.

“Our hope is to allow them to apply their expertise,” he said.

The loans will also go to small and medium-sized defense firms struggling to convert their products to civilian uses, he said.

Loans are available in $25,000 to $1-million increments, with flexible terms.

Dyna-Cam Engines of Redondo Beach is one small firm that is applying for a loan. Partners Pat Wilks and Dennis Palmer say they are poised to hire up to 100 former defense workers over the next few years to produce their newly designed small aircraft engine, but they have yet to find the start-up money to do it.

“Bankers are so conservative, you need a three-year track record,” Palmer said.

Palmer added that the machinists and engineers who will work for Dyna-Cam are just the beginning.

If the firm gets a loan and can start production, it will boost employment at its defense-related subcontractors as well.

Although hard times for such large defense firms as Hughes Aircraft Co. have loomed large in the public eye, Stevenson said the travails of smaller companies play a significant role in the slump.

“The reality is they are a very large part of the Southern California economy,” he said.