In addition to conventional loans, certain states have established Capital Access Programs
or other programs that provide lending to applicants who may not satisfy standard lending
criteria. Each funding source has its own credit parameters and requirements.
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STATE
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DESCRIPTION OF PROGRAM
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California
Represents 24.25% of
minority businesses
California State
Treasurer’s Office
Donna Yee
916-654-5740
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Small business lending
for underserved markets. Bank and
borrower each pay an up-front insurance premium (2%-7%) of loan amount at
bank's discretion, fee matched by the state to reserve fund.
Eligibility for borrower:
Small business as
defined by Small Business Act (15 USC Sec. 631) or fewer than 500
employees.
Purpose and Terms of Loans:
Lenders and borrowers
determine use of proceeds; lenders have flexibility in setting
interest rate, maturity date
and loan conditions.
Loan Range
Up to $2.5 million.
Link:
www.treasurer.ca.gov
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Texas
Represents 12% of
minority firms.
Texas
Dept. of Econ.
(select financial
incentives)
Ed Carter
512-936-0528
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Established for businesses and nonprofit organizations facing barriers in accessing capital.
Reserve account set at the lending institution to act as a credit enhancement, inducing financial institution to make the loan.
Eligibility for borrower:
Small business (100 or fewer employees), medium business (100 to 500 employees), and nonprofit organizations.
Purpose and Terms of Loans:
- Working capital,
purchase, construction or lease of capital assets (building and equipment).
- Refinancing of existing loan not originally enrolled in program is not eligible under the program.
- Amount of loan and pricing: 2% fee paid by borrower.
Loan Range:
($10,000 to $1.3 million) -- Determined by the Bank.
Link:
www.tded.state.tx.us
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New York
Represents 9.74% of
minority firms.
New
York City
Arti
Bhatp
212-312-3882
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New York City Capital
Access is a public-private lending program that is available only in
New York City
. The
program enables banks and community development credit unions to make loans
to small and mid-size businesses that do not meet conventional
guidelines. Cash reserve pool is etablished to cover losses in a participating lenders' portfolio.
Provides incentives to lend in low and
moderate income areas.
Eligibility for borrower:
New
York City
based commercial, industrial, retail enterprises and non-profit corporations.
Purpose and Terms of Loans:Loan Range: $l ,500
to $1 million.
Purpose is for working
capital, real estate acquisitions, machinery and equipment and physical
improvements to the real estate.
Link:
www.newyorkbiz.com
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Florida
Represents 9.43% of
minority firms
Enterprise Florida
Louie Latubscher
407-316-4962
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The Florida Capital
Access Plus Program (CAP+) is designed to increase availability of financing
for manufacturers and technology-oriented research and development
companies. Through loan guarantees
(50%), the program allows lenders to make a loan, which otherwise could be
made.
Eligibility for borrower:
Not applicable at this
time since funds are fully committed.
Purpose and Terms of Loan:
Limit of $250,000 is set
for the guarantee.
Link:
www.eflorida.com
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Illinois
Represents 3.63% of
minority firms.
Illinois
Dept. of Commerce
Kathy Sharp
217-782-3891
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CAP Program designed to
encourage lenders to make loans to businesses that do not qualify for
conventional financing. Borrower and
state each contribute a percentage of loan amount
into reserve fund located at lender's bank.
Eligibility for borrower:
For profit, located in
Illinois
and employ 500 employees or less.
Purpose and Terms of Loans:
Market transaction between lender and
borrower with all terms, fees, conditions, rates, collateral etc. determined
by lending bank. Borrower's
nonrefundable fee of 3% to 7% of total loan amount is contributed to reserve
account. State matches up to 133% of
borrower's contribution for first $2 million; higher match of 150% provided
for minority/woman.
Disabled-owned businesses and business
located in Enterprise Zone.
Loan proceeds cannot be used for
debt refinancing or for financing passive real estate ownership.
Loan Ranges:
Up to $2 million
Link:
www.commerce.state.il.us
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New Jersey
Represents 3.36% of
minority firms
New
Jersey
Economic Dev. Authority
(NJEDA)
609-292-0187
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Capital Access Program
is not available.
Programs available are:
-Under Statewide Loan
Pool for Business, NJEDA can provide a 25%
participation up to $500,000 and provide 30% guarantee.
For working capital up to a maximum of $1
million and $2 million for fixed assets financing.
-Direct guarantees of
conventional loans are available up to $1 million for working capital and
$1.5 fixed assets.
-Direct loans up to
$500,000 for fixed assets ;$250,000 for working
capital and $1 million for exporting purposes.
Eligibility for borrower:
For businesses who stimulate job and
economic growth and benefit to
New Jersey.
Link:
www.njeda.com
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Georgia
Represents 2.92% of
minority firms
Georgia Dept. of Community Affairs
Steed Robinson
404-679-1585
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Capital Access Program
is not available. Programs
administered are state and federal grant programs focused at economic
development. (Section 108 Program.)
Industrial Revenue Bonds
are available for construction of manufacturing facilities to financially
qualified borrowers. Up to 100%
financing available for cost of land, building & equipment.
The Appalachian Region
Business Development Revolving Loan Fund is designed to give loans to private
industries through local development authorities.
Link:
www.state.ga.us
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Maryland
Represents 2.72% of
minority firms.
Maryland
Dept. of Housing & Community Affairs
Ted Conlon
410-209-5804
Tara Clifford
410-209-5819
(Outreach Program)
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Capital Access Program:
Credit enhancement
program that enables private lenders to establish a loan loss reserve fund
from fees paid by lenders, borrowers and state of Maryland for loans that
fall outside lender's normal credit guidelines.
Eligibility for borrower:
Small businesses
including non-profit organizations.
Businesses must be located in
Maryland
's Priority Funding Areas.
Purpose and Terms of Loans:
- For working capital or
terms loans for business purposes. May
be combined with other loan programs
Loan Range:
$10,000 to $1 million
Link:
www.dhcd.state.md.us
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Virginia
Represents 2.36% of
minority firms
Virginia Small Business
Finance Authority (VSBFA)
CAP Program
Anna Cobb
804-371-8255
Erik Riley
804-786-3104
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Virginia Capital Access
Program
Program establishes a
loan loss reserve at each participating bank which is funded by enrollment
premiums paid by borrower/bank and VSBFA.
Premium paid by borrower
ranges from 3% to 7% of loan amount are non-refundable.
Eligibility for borrower:
Financing must be used
for Virginia
business operating and borrower must be small
business with: Annual revenues of less
than $10 million; net worth of less than $2 million and less than 250
employees.
Purpose and Terms of Loans:
Working capital,
expansion and equipment financing.
Terms and interest rates set by participating banks.
Loan Amount:
Maximum of $250,000
Loan Guaranty Program
VSBFA will guarantee a
maximum of 75% up to $300,000 for loan or line of credit up to a maximum of
three years in duration.
Link:
www.dba.state.va.us
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Michigan
Represents 1.7% of
minority firms
Mich.
Econ. Dev. Corp.
Mark Morante
517-241-5680
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Capital Access Program:
Program allows banks to
make business loans that do not meet conventional bank guidelines.
Utilizes a special loss reserve to assist
banks in covering losses. One-time
premium payments (range from 3% to 7% of amount borrowed) help fund the
special loss reserve.
Eligibility for borrower:
- Program is broad based
and can be used my most types of businesses determined by the bank.
Purpose and terms of Loans:
- Determined by bank.
Loan range:
No minimum or maximum amounts.
Link:
www.michigan.org
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