Plan Unveiled to Spark Valley Business Growth : Economy: Group’s initiatives emphasize loans, other aid to small firms, but level of federal support is uncertain.

An ambitious, five-year strategic plan to help spur business growth in the Valley was presented to Mayor Richard Riordan on Thursday by the Economic Alliance of the San Fernando Valley.

But it was unclear how much money the federal government will be able to supply the local business group to help jump-start the plan.

On Thursday, the alliance listed 15 key initiatives, such as setting up a permanent loan fund for small businesses and improving education to better prepare students for the workplace. The plan also includes hiring a coordinator to target businesses that are thinking of moving and solve their problems before they leave the area.

To build a staff, pay for marketing and set up special programs, the alliance said it needs $20 million over five years. It also wants another $10 million for its small-business loan program.

The group said it hopes to raise about half that from private contributions, and in the past month has raised $254,000 from local businesses.

Daniel Tabor, a liaison for the U.S. Department of Commerce, said $150,000 in federal seed money is targeted for the alliance, and that the group’s $10-million loan fund is a priority. But given the uncertainties in Congress over the federal budget, “we’re not able to determine . . . how much or how soon” more money will be committed to the group.

The alliance, a group of volunteers from the Valley Industry and Commerce Assn., the Valley Economic Development Center, the United Chambers of Commerce and the California Industrial Leadership Council, did an extensive survey of businesses after the Northridge quake to devise a unified strategy to promote growth.

The alliance’s survey of the Valley found that while entertainment employment jumped 44% between 1987 and 1992, aerospace and defense jobs tumbled 24%. It also found that small businesses dominate the area, with 95% of all companies here employing fewer than 50 people.

The survey also showed that one-third of Valley businesses are thinking of moving or expanding outside the area. That is “a scary statistic,” said John Rooney, president of the Valley Economic Development Center, a nonprofit group in Van Nuys that helped assemble the alliance’s economic strategy.

After the Northridge quake, Rooney’s group was given $6.25 million by the Commerce Department to lend to quake-damaged businesses that either didn’t qualify for Small Business Administration loans or didn’t get all the money they needed.

So far this year, the center has lent $4 million to 14 small companies, ranging from a wholesale meat supplier to machine shops. “Many of those businesses would have lost jobs or closed down if they’d not gotten the loans,” Rooney said.

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Within six months, the alliance and Rooney hope to sell off to private investors the Valley Economic Development Center’s $6-million loan portfolio and use the proceeds to replenish its small-business loan fund.

Given Los Angeles County’s $240-billion gross domestic product, though, another $6 million or $10 million a year “is not even drop in the bucket,” said John Hekman, with the Economic Analysis Corp.

But Riordan disagreed. For “small entrepreneurs and medium-sized businesses, a $50,000 or $100,000 loan can be a gold mine for some to get them started,” he said.

Riordan also said he expects within a couple of weeks to announce formally that a real estate development company will buy the former General Motors assembly plant site in Van Nuys and, after putting up new buildings, lease space to retail and industrial firms.

It has been previously reported that the Voit Cos. and Selleck Properties are possible buyers of the GM site.