The Cost of Money.
In the end this is a question about the cost of money. There are numerous variables that go into the cost of money. The easiest to consider of course is the interest rate. But as Jesse and Jerry have pointed out there are lots of other variables for consideration in the cost of money. These include the term, the payments, the collateral, the control. One that is often not taken into consideration when taking public money is the public disclose that may or may not be a contingency of its use.
The Decision to Take Money
Clearly you need to first make the decision that your business plan would be better executed if you had access to additional resources. In other words -- you have made the decision that you would take money. It is not a good idea to take money just because it is available. You need to have a solid business plan with scenario-based assumptions that clearly show that the infusion of money results in returns that can support repayment without crippling the businesses future sustainability and desired growth -- then borrowing money might be the right choice for financing growth of the business.
The decision to act "conservative" and borrow a little or "liberal" and borrow a lot has nothing to do with the source of the money -- it has to do with what your business plan supports.
Political Consideration
After the analysis of if the terms are better than those you can get through other means-- and it is the best/right solution for your business and the question remains about the taking of government money-- then this is a political question.
Personal integrity is important to us all. Congruency between our beliefs and actions is important. If you strongly believe that Government stimulus money is wrong and that engagement in private business is not an appropriate role for government-- then regardless of the terms, a government backed or supported note is probably not the right choice for you.
Production not Consumption
My last point, while not addressing a specific issue in the quesiton is often an issue that I am forced to address when talking with business owners about the decision to grow by leveraging a new source of revenue.
Whether the money is a loan or capital investment -- the money is to be used to drive product for the growth of your company. It is not used to increase "consumption" -- meaning paying deferred compensation, increase the owners standard of life, buying fancy things. These things are paid for not out of loan or investment money, but the increased profits of the company.
Good Luck Victor! I hope we see lots more question from you that let us know what your decision was and how it is working!
