KENNESAW - Downtown Kennesaw's Trackside Grill at South Main and Cherokee streets will expand in few months thanks to a low interest, $140,000 loan from the state.

The eatery, which serves southern American cuisine, has been in operation since 2003 and continues to grow, owners Brett and Laura Olszeski said. The Kennesaw Downtown Development Authority introduced the couple to a state loan program that provides funding to assist governments in revitalizing downtown areas.

The stated goal behind the Georgia Department of Community Affairs' Downtown Development Revolving Loan Fund is to spur commercial redevelopment.

Trackside Grill was awarded the 15-year, fixed rate loan at 3 percent last week to expand its dining area with an enclosed two-story, outdoor patio, complete with a large fireplace. The project will also include a rooftop deck and construction of a larger bar inside the restaurant.

As a result of the expansion, the restaurant will hire 15 more workers to its current 25-member staff, said Brett Olszeski, 46.

The Kennesaw City Council authorized the expansion plans in December. No city money will be used in the project, said Bob Fox, Kennesaw Community Development director. It's the first project in Kennesaw to be awarded a DCA revolving loan. The city is also working with the nonprofit Georgia Cities Foundation to help another business acquire a similar revolving loan from its program.

"We want to encourage expansion of commercial downtown, including restaurant space," Fox said.

In addition to the loan that the Olszeskis are responsible for paying back, the couple will also use a bank loan and equity to finance 60 percent of the restaurant expansion.

Brian Williamson, DCA assistant commissioner for community development, said such public-private partnerships have for years been important to local economies across the state.

"Those are actually a fairly common vehicle around the state for spurring economic development that has a little bit more of a challenge occurring - things in historic downtowns where sometimes banks are not able to lend the full amounts," Williamson said.

The DCA's Downtown Development Revolving Loan Fund has received a total of $7.9 million since first being appropriated with funding in 2000 from the General Assembly, Williamson said. Of that amount, $3.4 million has been repaid to the revolving loan fund by borrowers. That money is then reused to finance other loans.

"Essentially, those monies are loaned, repaid, loaned again, repaid and so on," Williamson said. "The project in Kennesaw is not done with appropriated funds. It's done with funds that have been revolved through that mechanism."

Revolving loan applicants must demonstrate that they have a viable downtown development project.

"Eligible use of the funds include such downtown development projects as real-estate acquisition, clearance, development and redevelopment, construction, reconstruction, and rehabilitation of public and private infrastructure and facilities," according to the DCA.

Unfortunately, Williamson said, the current state of the economy means that only a handful of loans are out at any given time. In February 2008, the Battles Building project in downtown Acworth was awarded the maximum DCA revolving loan amount of $250,000.

Construction on the Trackside Grill expansion project will likely begin in September and is expected to last 90 days, the Olszeskis said. They said the restaurant will remain open during construction.

The couple said they're grateful for the loan and believe it will help bring more people to downtown Kennesaw.

"There are not a lot of restaurants around here that offer just a pretty patio," Brett Olszeski said. "We're going to do some live music. And people, instead of just dining and going to a movie or something, can meet friends here and have a whole experience by the fire or drinks after dinner."

For more information on the Georgia Department of Community Affairs' Downtown Development Revolving Loan Fund, visit www.dca.state.ga.us.