You are viewing this article in the archives. For the latest breaking news and updates in Ann Arbor and the surrounding area, see
Posted on Mon, Jun 25, 2012 : 5:45 a.m.

MEDC announces $250,000 loan support for manufacturer Hines Industries Inc.

By Ben Freed

Hines Industries Inc. of Ann Arbor is expanding and hiring new employees after receiving funding through a Collateral Support Program run by the Michigan Economic Development Corp.

The program, established in early 2010 to help Michigan businesses get loans during the recession, helps companies whose assets were devalued in the recession to acquire funding to grow their business.

“For a manufacturer like Hines, the bank will only let them borrow up to 80 percent of the value of their assets,” said Paul Brown, vice president of capital services at the MEDC. “So when the values dropped after the real estate bubble burst, these companies that were still doing great business were not able to get financing.”

Hines Industries designs and produces balancing equipment for a wide range of industries, including the automotive, aerospace and medical device sectors. It received $250,000 for working capital tied specifically to a new agreement with Chrysler, according to a statement released by the MEDC.

Any piece of machinery that spins quickly (such as a fan, pully, motor or crank shaft) must be perfectly balanced in order to prevent vibrations during the rotation. If there is even slightly more weight on one side of the disc or cylinder, centrifical force (the force pulling weight away from the center of the circle) will pull at the device unevenly. This causes the vibrations that can lead to a decrease in the quality or lifespan of the product.


A balancing machine from Hines Industries, Inc.

Courtesy Hines Industries Facebook Page

“Even a little bit of grease from your fingers can be enough weight to throw certain pieces off balance,” Dawn Hines, CEO of Hines Industries, said. “We have a deep and long experience in examining the parts and correcting any unbalances.”

While balancing devices is a niche market, Hines has become an industry leader and was looking to expand when it applied for collateral support. Hines said that engineering and manufacturing companies need a lot of working capital in order to finance the development and production of larger projects before they can reap the benefits.

“This loan that we were able to acquire with the MEDC’s help has enabled us to compete for larger and more complex products with larger companies,” Hines said.

“It has also enabled us to hire some of the talent we need to grow the business. We’ve already hired five new engineers and we are looking to grow even further. We are part of hiring back Michigan talent, and that’s really exciting.”

So far, 96 companies have taken advantage of the MEDC’s Collateral Support and Low Cost Participation loan programs. The programs started out with state resources and were noticed by the White House. Brown was invited to testify before Congress, leading to the creation of a $1.5 billion national program created by the U.S. Treasury to fund similar programs.

Since the creation of that fund, Michigan has received an $80 million grant to operate the programs that “stretch” banks' abilities to make large loans.

MEDC President and CEO Michael Finney said in a statement that the Loan Participation program will allow these companies to move forward, which will in turn bring jobs to the state.

“Today’s loans are a clear example of economic gardening in action, leveraging state resources to foster private sector solutions for businesses of all sizes and industry sectors,” he said in the statement.

The program works by injecting capital into banks in the form of accounts opened by the MEDC that also function to close the “collateral gap” that companies and banks have when they attempt to make large loans with low-value assets as collateral.

The rules of the program stipulate that the MEDC account can be no more than 49.9 percent of the collateral and cannot exceed $5 million, said Brown.

“We deposit the money as an account at the bank making the loan. We get interest on the money in the account, and they can use that money to re-invest and make other loans,” he said.

“This is what many people think TARP should have looked like — an injection of capital tied to real loan-making. The bank now has a fully collateralized loan and increased deposits. In the case of default, the bank would liquidate the borrower's collateral and then seize whatever portion of our deposit they needed.”

Brown was quick to point out that to date there have been no defaults in the program.

"Michigan businesses have the opportunity to grow; we're just trying to assist them in having the capital to do so," he said. "It's a win-win."

Ben Freed covers business for Reach him at 734-623-2528 or email him at Follow him on twitter @BFreedinA2



Tue, Jun 26, 2012 : 12:08 a.m.

Ben - on second thought don't look too hard -- we don't need more unemployed in MI and Laurel doesn't tolerate much around SPARK or the gov.


Mon, Jun 25, 2012 : 10:54 p.m.

Hey, -- how about checking campaign contributions and Hines Industries for us? I think we'd like to know if there's a link between campaign contributions and MEDC grants. How about checking in on that? Simple request. Let's see. I'll bet there's no response from


Tue, Jun 26, 2012 : 12:07 a.m.

Thanks Ben for finding support for the party that gave the money. I suspect there's money that you can't find -- 'corporations are people'. If you look harder (and that will get you fired - or eligible for a free internship via SPARK - you may find out something. Us ordinary working folks don't have time but you're a journalist so I suspect you may find it.

Ben Freed

Mon, Jun 25, 2012 : 11:33 p.m.

Hi Townie, Thank you for your comment. I went ahead and checked the campaign contributions of Hines Industries. Campaign contributions can be easily researched on the FEC website ( Neither Hines Industries nor any member of the Hines Family donated to Governor Rick Snyder's campaign. The only campaign contribution on record for the company is a $1,000 donation to the National Republican Congressional Committee, but that was in the year 2000, long enough ago that it's probably safe to say that it had nothing to do with the receipt of collateral loan support. As for the SPARK connection, Hines is not listed as an "investor in SPARK," nor are they listed among SPARK's "open source economic development partners." ( I hope you found this helpful, thanks for reading, Ben

Kai Petainen

Mon, Jun 25, 2012 : 2:05 p.m.

congrats! "So far, 96 companies have taken advantage of the MEDC's Collateral Support and Low Cost Participation loan programs" that's pretty cool...


Mon, Jun 25, 2012 : 10:43 p.m.

Peanuts. This is one more scam for positive PR for Snyder and SPARK. Throw a few peanuts at a few companies and play it for all it's worth. Crony capitalism. If I had the time I'd check and suspect I'd find some interesting relationships between the owners of these companies and the Gov and SPARK. How about taking a look Oh, I forgot - you're part of the scam.

Ron Granger

Mon, Jun 25, 2012 : 1:43 p.m.

Ben Freed has written a nicely balanced article about a critical business segment - small manufacturers in Michigan. Those companies don't do big numbers but they are a critical part of keeping our manufacturing going. How ironic that wallstreet will gamble billions, but not loan money to small companies.