COEUR d'ALENE - While it is going to take some time, the Panhandle Area Council is starting to turn around financially, according to its board chairman.

Kootenai County Commissioner Dan Green briefed his fellow commissioners on the status of PAC during a meeting in commission chambers Monday.

"Since Jim (Hammond) has come on board, there have been a few positive things happen," Green said.

The commissioner, who chairs the PAC board, said Hammond was able to negotiate a new lease with Empire Airlines, which will allow the agency to refinance some of its debt.

Green said PAC's traditional funding streams began drying up years ago, and over time the agency has developed a cash-flow issue.

"It just kind of fizzled away and PAC became stagnant," Green said, adding Empire's new lease agreement will enable the agency to turn things around. "There is a lot that I would like to see done, but first we have to get the finances back in order."

Several years ago, when Empire Airlines was considering a move to Spokane, the Panhandle Area Council offered to build the company a new hangar and lease it back to the company.

"If it wasn't for PAC, Empire Airlines wouldn't be here today," Green said. "PAC can be a great resource when it's strong."

In order to finance the construction of the hangar, Green said PAC had to put up two sources of capital to generate income for the agency.

They had to put up a $350,000 certificate of deposit with the bank as collateral, and pledge funds from another federal program to secure the loan. Now that PAC can refinance that loan, the agency will free up those funds and start to get back on track.

PAC's primary income stream used to be grant administration fees and interest on small business and municipal loans. Green said things got so tight a few years ago that many of its loan officers and grant administrators were let go and never replaced.

Green said Kootenai County actually contributed to that by taking all of its grant administration in-house. Before that, Green said, the county paid PAC as much as $96,000 a year for grant administration.

He said many things need to change once the money issues are worked out, but things are looking brighter for the agency.

Green wants to work on improving the agency's public outreach and public advocacy, and the board needs to get more engaged.

Meanwhile, Hammond is working to update its comprehensive economic development strategies to make the agency eligible for more federal grant programs.

"I have a plan, but the board really isn't that engaged," Green said. "Getting the right expertise on the board is important. We need members who are engaged and want to be there, not someone who feels obligated to be there.

"That isn't going to happen overnight, though."