“For Where Your Septic Tank is, There Your Heart Will Be Also”: Enterprise Cascadia and the Hood Canal Septic Loan Program

Jan Markham's team was currently considering Enterprise Cascadia as a potential awardee for her foundation's Community Investment Excellence Awards program. The program had been established to recognize and aid in the growth of community development financial institutions that achieved excellence in each of six areas: vision, use of funds, leadership, innovation, financial strength and performance, and impact and policy. Markham's task was to determine if Enterprise Cascadia met these requirements and if it would be a prudent investment for her foundation. Excerpt UVA-ENT-0180 Feb. 10, 2012 “FOR WHERE YOUR SEPTIC TANK IS, THERE YOUR HEART WILL BE ALSO”: ENTERPRISE CASCADIA AND THE HOOD CANAL SEPTIC LOAN PROGRAM Jan Markham made her way along the winding roads back to the Portland airport. The majestic trees emerging from the roadside mists intruded upon her thoughts as she reviewed her meetings with Enterprise Cascadia (EC). After two days of presentations and site visits in rural Oregon and Washington, she was headed home to decide with her foundation's Program-Related Investments (PRI) team whether the James A. Stonefield Foundation would be investing in EC, and if so, how the investment would be structured. Markham knew the team would likely accept her recommendation, so responsibility for the eventual decision lay with her. Markham set the rental car's cruise control and began to review the facts. Markham's team was currently considering EC as a potential awardee for the foundation's Community Investment Excellence Awards program. The program had been established to recognize and aid in the growth of community development financial institutions (CDFIs) that achieved excellence in each of six areas: vision, use of funds, leadership, innovation, financial strength and performance, and impact and policy (see Exhibit 1). Markham's task was to determine if EC met these requirements and if it would be a prudent investment for the Stonefield Foundation. The project that had captured the foundation's attention was EC's Hood Canal Regional Septic Loan Program, the result of a unique blending of public and private interests and resources. The loan program provided consumer loans for upgrading septic systems at income-adjusted (low) interest rates, and the loans were intended to benefit the homeowner, the local environment, and the local economy, which had strong ties to the health of waterways. After three years of service in the Hood Canal region of Washington, EC was seeking capital to expand the program beyond its current three-county footprint. In addition to determining whether the award's criteria were met, Markham needed to evaluate whether the firm was prepared to make the necessary financing, implementation, and managerial changes to fit a different market. . . .