WASHINGTON, D.C. — The U.S. Department of the Treasury’s State Small Business Credit Initiative (SSBCI) Wednesday released a new quarterly report showing that West Virginia has deployed $12.5 million to grow West Virginia small businesses through June 2013. The figure represented 95 percent of West Virginia’s total SSBCI allocation, one of the highest usage rates across the country. The quarterly report also demonstrated that the majority of states have accelerated their expenditure, obligation or transfer of SSBCI funds during the first half of this year.
SSBCI on Wednesday also published its first annual report, which shows that the program has already supported loans and investments to more than 4,600 U.S. small businesses totaling $1.9 billion nationwide. The report, a summary of 2012 annual reports from the 47 states, the District of Columbia, five territories and four municipalities that received federal SSBCI funds, showed that the program helped small businesses create or save 53,000 jobs and that nearly 80 percent of SSBCI loans and investments went to businesses with 10 or fewer employees.
“These federal funds are allowing small businesses and entrepreneurs to expand their operations, hire new workers, and power the economic recovery across America,” said Treasury Assistant Secretary Cyrus Amir-Mokri. “This program is an important component of the Obama Administration’s efforts to provide capital for small businesses.”
States reported that SSBCI financing reached small businesses in a diverse range of industries in 2012, from retail trade – which received the greatest share of SSBCI loans or investments – to manufacturing, hospitality, and many types of services. About two-thirds of all SSBCI loans or investments were for less than $100,000, and the average SSBCI loan or investment size was $327,000. To qualify for SSBCI support, small businesses must use the federal funds to leverage private capital.
“SSBCI’s innovative funding structure allows each state to design its own small business support programs in response to local economic conditions and capital needs,” said State Small Business Credit Initiative Director Cliff Kellogg. “These federal funds have helped states create over 70 new small business programs, building a new network of credit support across the country.”
SSBCI was created three years ago this week, when President Obama signed into law the Small Business Jobs Act of 2010 on September 27, 2010. Through SSBCI, the U.S. Department of the Treasury awarded almost $1.5 billion to fund programs that support small businesses and small manufacturers. The program is expected to help spur up to $15 billion in new private sector lending or investment in small companies by leveraging $10 in private capital for every dollar of federal support by the program’s end.
SSBCI programs fall into five categories: Capital Access Programs, Loan Participation Programs, Collateral Support Programs, Loan Guarantee Programs and Venture Capital Programs. Treasury awarded allocations based on a formula in the Act that considered population and unemployment levels in 2008 and 2009. SSBCI funds are disbursed in three equal installments to each state. Subsequent disbursements are made when states expend 80 percent of their previous installment. Both existing and new state programs are eligible for SSBCI support.
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