A state of Massachusetts-backed operating loan will help a Worcester, Mass., recycling company stay open.
Creative Packaging Inc. and Creative Paper Inc., which operate a cardboard box recycling plant in south Worcester, received a $350,000 operating line of credit under a special state program aimed at protecting jobs.
The four-year revolving loan, arranged through Flagship Bank, is backed by a guarantee from the state Economic Stabilization Trust, administered by Commonwealth Corp., a quasi-public state agency.
The plant recycles old corrugated containers.
The company has had environmental problems in the past, and has been cited for noxious odors and air pollution violations by the state Department of Environmental Protection.
To address those problems, the plant installed a much larger and higher smokestack and worked on reducing odors in the neighborhood. The plant also installed a closed-loop rinse water system that recycles water through the plant to save water and eliminate wastewater discharges.
Jonathan Raymond, president of Commonwealth Corp., said the taxpayer-backed guarantees allow companies to leverage higher credit lines than might be available through regular commercial loan providers.
Companies pay 6 percent of the value of the total loan in fees to Commonwealth Corp., in addition to the commercial lending interest rates charged by the lending institution.