Group, state team up to lure angel investors

Invest Nebraska Corp. has partnered with the Nebraska Department of Economic Development to promote angel investment as a source of funding for some Nebraska businesses. Angel investors are wealthy individuals who are interested in funding high-growth startups. Invest Nebraska, a nonprofit group that helps fledgling businesses with high-growth potential take flight, has committed to a two-year program that will include business plan competitions, seminars for potential investors and the formation of a statewide network for angel investment groups.

Angel investors are typically the first place that companies turn to acquire funds to accelerate business expansion, said Bryan Fairfield, an Invest Nebraska board member. The expansion of angel investments is important to the state because fast-growing businesses have a substantial economic impact by creating jobs, wealth and a higher tax base, Fairfield said.

Angel investment creates a cyclical process of reinvestment in the community because the high returns investors receive allow them to continue to invest in other startups, he said. Targeting high-growth businesses in Nebraska will aid economic development by encouraging existing businesses to stay here, attracting businesses from other states and encouraging startups, Fairfield said. Implementation of the plan should start in June, Fairfield said.

Invest Nebraska, NDED Sign $500,000 Contract to Promote Angel Investment in Nebraska

Invest Nebraska Corporation, a non-profit organization committed to assisting emerging Nebraska-based businesses with fund-raising and business development efforts, has announced it has entered into a $500,000 contract with the Nebraska Department of Economic Development (NDED).

Under the agreement, Invest Nebraska will carry out a state-mandated program to promote angel investment in Nebraska. The funding for the program is derived primarily from state appropriations, approved by the Nebraska State Legislature.

Under the contract, Invest Nebraska will match at least one-third of the funds. This goal is to create a state-wide angel investor network to help Nebraska businesses in the early stages of fund-raising. Angel investors are typically the first investor outside the scope of “family and friends”, and allow emerging businesses to build up to venture capital and private equity investments.

Eligible candidates for angel investments include any individual, corporation, partnership, limited liability corporation, or joint-stock company, with its principal place of business in Nebraska. The program will also extend to start-ups elsewhere that are committed to basing their business in Nebraska. For more information about Invest Nebraska Corporation, visit www.InvestNebraskaCorp.com

Companies expanding in Nebraska now have more “advantages” to choose from

LB895, passed by the Legislature and signed by Gov. Dave Heineman earlier this year, adds another tier to the successful Nebraska Advantage package of incentives for businesses that relocate to or expand in the state. Businesses will qualify for the Super Advantage if they invest $10 million while creating 75 jobs paying either 200% of a county’s average wage or 150% of the state’s average wage, whichever is greater. Businesses also will qualify if they invest $100 million capital investment while creating 50 jobs at the thresholds stated above.

These wages range from $50,700 (160% of State’s average annual wage) to $91,972 (200% of Stanton County’s average annual wage). In return for a company’s investment and job creation, they would receive a 15% investment credit, 10% wage credit, tangible personal property exemption for 10 years, and a sales tax refund on all capital purchases. In addition, the company may use the credits to offset their real property taxes at the site of the project, as well as apply them to sales and income taxes, and employee withholding. The entitlement period is 10 years for these benefits as opposed to the next highest entitlement period of seven years.

Nebraska gas station owners make little profit from gasoline sales

Patricia Tillotson and her husband own a convenience store in Battle Creek. Tillotson said customers now understand the high pump prices at Tilly’s Gas & Shop and other gas stations around the country aren’t the fault of the station owners. Like most stores of its kind, Tilly’s makes a majority of its profit from grocery and other convenience items.

Tillotson said it’s difficult to keep a small business operating in a small town when the cost of everything is increasing. “I’ve heard a lot of people say, ‘We’re not even bothering to get the camper out,’” she said.

Hal Seeley, who opened Four Seasons Mini Mart in Pierce with his wife, Mary, earlier in the year, said gas station merchants make very little - if anything - on the sale of gas. “Quite often, we’re making only three to five cents a gallon,” he said. But when customers use a credit card to purchase fuel, there are charges and fees that have to be paid that often subtract from what minuscule profit there is, he said.

Nebraska’s economy slows in May

Information businesses in Nebraska — such as publishing companies — struggled in May and inflation continued to be a concern. That’s according to a new survey of supply managers and business leaders in the state. Creighton University economics professor Ernie Goss oversees the monthly survey. The problems for information companies in the state offset strong performances other businesses reported.

Durable goods producers in the state — especially ones with strong ties to the farming — reported strong growth for May. The state’s overall economic index slipped in May to 50.3. The rating was 51 in April. Any score greater than 50 on the index indicates an expanding economy over the next three to six months.

Nebraska unemployment rate drops a tenth, to 3.1%

Nebraska officials estimate that the state unemployment rate increased slightly in April, to 3.1%. That’s a tenth of a point higher than the adjusted March figure of 3%. The February figure was 2.8%. The Labor Department says the national figure for April 2008 dropped a tenth of a point to 5%.

All contractors in Nebraska must register

An expanded state law that goes into effect July 18 requires contractors and subcontractors doing business in Nebraska to register with the state. The expanded law also increases the registration fee, from $25 to $40, said Bill Hetzler, director of safety and labor standards for Nebraska Workforce Development/Department of Labor in Omaha.

Failure to register can result in a fine up to $500 for a first violation and up to $5,000 for a subsequent violation, Hetzler said. A person who is self-employed and does not pay more than $3,000 annually to employ others in the business is exempt from the $40 fee, but must fill out an affidavit with an application.

Contractors can fill out the registration application under the “labor/safety laws” section at www.nebraskaworkforce.com, but the application must be printed out and mailed in with a check for the $40 fee, Hetzler said. More information is available by calling 402-595-3095.

State warns against Internet loan scheme

The Nebraska Department of Banking and Finance warned Thursday against dealing with a company calling itself Penbrook Financial Group and giving a fictitious Omaha address. The department said Penbrook offers personal loans over the Internet and requires upfront “collateral payments” before making loans, usually $2,460 in four monthly payments.

The company does not have an office at the address it lists, the department said, and Nebraska law prohibits lenders from requiring advance payments. The department said it is trying to shut down the company’s Web site, which does not list a telephone number. The company could not be contacted for comment.

People who have dealt with Penbrook should contact the department at 877-471-3445 or the Federal Trade Commission at 877-382-4357. Department analyst Karen Reynolds said people should be careful about making online loan applications that require personal information. Online lenders may try to bypass state law by claiming residence in a different state or may adopt the name of a legitimate business.

Lexington, Neb. gets 100-year rain

Lexington, Neb. Mayor John Fagot said the recent rain is one for the record books. He said according to statistics specific to Lexington, the downpour can officially be called a “100-year rain.” Taking the floodplain into consideration, the amount of rainfall is classified in this unusual category. Nearly every road in Dawson County became flood ground when this heavy rain descended upon the county Thursday night and didn’t let up until late Friday morning.

Flooding Sinks in for Central Neb. Farmers

The sound of waves isn’t soothing to the ears of farmers. Not when the water is in their fields. “Oh my gosh, when’s it going to quit?” asked farmer Virgil Byerly, who grows corn and soybeans north of Grand Island. Farmers like Kenny Clausen and Larry Knuthe haven’t seen their fields this bad since 1967. The impact may hit Dawson County farmers the hardest.

Cozad received almost eight inches in two days. Randy Schneider of Cozad has some crops covered with up to two feet of water. “I haven’t seen this much rain in all my life,” he said. That’s almost 60 years.” He’ll have to replant. “That’s not going to be real good with the price of fuel,” he said.