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About five years ago, businesses in the small Northeast Iowa town of Fayette started closing their doors. Most of the business owners had reached retirement age or had been in business for many years and were ready to start new chapters in their lives. Fayette lost nearly 10 downtown businesses during a short span of time, leaving empty storefronts to blemish the otherwise beautiful two-and-half-block downtown area.

“Many residents and other business owners in town were really getting concerned,” said Kris McGrane, Fayette’s city administrator/clerk. “Nobody wants to see empty storefronts in their city.”

Fayette isn’t unlike many rural communities facing the challenge of a shrinking retail environment, but it is taking innovative steps to buck the trend. Fayette is already unique in that, despite its small size (population around 1,400), it is home to Iowa’s only Division II university, Upper Iowa University. With the university serving as an employment and economic engine for the region, the city is striving to grow and thrive rather than shrink and stagnate.

Starting in 2016, Fayette has had seven new businesses open and one expand. The new small businesses range in offerings from yoga to tattoos to gourmet flatbreads, and new opportunities have been identified to keep the momentum going.

In partnership with Upper Explorerland Regional Planning Commission (UERPC), Fayette was awarded a Rural Business Development Grant (RBDG) from Rural Development, an agency of the USDA, that helped start a Revolving Loan Fund (RLF) program last year. Two new businesses, Fayette Sweets Café and The Beauty Room, took advantage of the RLF program this year. The RLF program is designed to provide attractive financing terms to businesses that are otherwise unable to borrow needed funds through traditional bank financing.

“The new business owners have been very creative and are offering unique places that are not like anything else in this area,” shared City of Fayette Mayor Andrew Wenthe.

For example, Fayette Sweets Café owner Kristy Donovan’s vision for her business was to make a visitor feel as if they’ve been whisked away to Paris when biting into her made-from-scratch chocolate croissant. Guests may color on the white paper table cloths or relax in a cozy chair while they enjoy a variety of homemade sweets and baked goods, including scones, danishes, and cinnamon rolls. Locally roasted coffee and tea are also available.

Other new businesses include Shrubb’s Street Eatery, known throughout the region for their gourmet flatbread entrees. Shelby Sebring, a local esthetician and certified eyelash technician, opened up The Beauty Room, which specializes in traditional and airbrush makeup, eyelash extensions, and body waxing.

Dollar General opened a new store in downtown Fayette in the fall of 2018, giving locals a place to pick up a variety of necessities without having to travel outside of town. The Fayette County Thrift Store and Food Shelf is almost finished with an expansion which will provide more space for their thrift store.

Fayette is currently working on a contract to lease out a city-owned storefront on a month-to-month basis. The idea is to give people who are thinking about opening a business a chance to try it out on a short-term basis with low costs. A few Upper Iowa University students are already interested in leasing out the storefront for a few months this fall to sell their outdoor clothing apparel and offer guided trips around the Driftless region, which includes Fayette.

“Klock’s Island Park and Campground and Fayette’s other great businesses bring people to our town,” said McGrane. “These new businesses will add to the appeal to help bring more people to our town. We still have room for more new businesses and more money in our revolving loan fund to help.”

New downtown Fayette businesses since 2016 include:

  • • Last Stand Tattoo (2016)
  • • Full Circle Services (2016)
  • • Yoga Genesis (2017)
  • • Shrubb’s Street Eatery (2018)
  • • Dollar General (2018)
  • • Fayette Sweets Café (2019)
  • • The Beauty Room (2019)

An expansion at the Fayette County Thrift Store and Food Shelf is underway.

Visit for more information about the Fayette community.