A local bank is helping nonprofits left in the lurch by the failure of the state lawmakers to pass a budget.

Dunmore-based Fidelity Deposit amp; Discount Bank is offering loans up to $100,000 interest-free for six months to nonprofits hurt by the state budget delay in Luzerne and Lackawanna County.

It may be free money, but it not necessarily easy money. Borrowers still have to meet the underwriting guidelines of any other commercial loan. After six months, most loans will revert to prime.

"We are trying to fill this financial gap made by the state," said Daniel Santaniello, chief executive officer at Fidelity. "These are agencies that are important to the community. By helping them, we are giving back to the community."

One of those agencies is the Victim's Resource Center based in Wilkes-Barre, providing services for victims of crime and domestic abuse in Luzerne, Carbon and Wyoming counties.

For the last few weeks, the agency saw funding from the Pennsylvania Coalition Against Rape, the Pennsylvania Commission on Crime amp; Delinquency and the Pennsylvania Coalition Against Domestic Violence dry up. The organization has been on austerity, said Janet MacKay, executive director. Nonvital purchases have been put off, travel curtailed. The agency has negotiated with its three landlords for forbearance and tapped into lines of credit.

"The wonderful thing about what Fidelity is doing is that there is no interest and after that, the loan is at prime," Ms. MacKay said. "It's a blessing to be able to make payroll and not face mounting interest."

But looking down the road, she's not sure what will happen if the state budget impasse extends into December. Most of the center's clients are victims of sexual abuse.

"Our services are 24-hour and crisis oriented - we can't shut down," she said. "If we can't get someone to accompany a rape victim at a hospital, there will be consequences."

Mr. Santaniello is up front about a marketing component to the program. He hopes nonprofits who participate find the bank meets their need and recognizes Fidelity's community-mindedness.

"I'd be lying said we didn't hope to get more customer relationships," Mr. Santaniello said.

Ms. MacKay said Fidelity is not the organization's main bank. Those decision are "up to the board of directors."

Financial institution analyst Bert Ely, based in Alexandria, Virginia, said with banks' cost of funds being so low, and most banks awash in cash, Fidelity's free money won't impact the bank's bottom line the way it might if interest rates were 9 percent. He considers it a novel marketing program, but one that nevertheless does some good.

"I'm sure this nice civic act will be appreciated," he said. "I hope it increases political pressure on state lawmakers who see these entities coming against the wall in a way that the banking industry has to fill in the gap."

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