Business Oregon to Start Disbursing $16.5 Million in Federal Small Business Assistance Funds
Loan and Credit Assistance Expected to Generate $165 Million in Lending to Oregon Small Businesses Over Next Four Years
SALEMBusiness Oregon will begin accepting applications this week for awarding $16.5 million in federal small business assistance.
The funding, from the U.S. Treasury's State Small Business Credit Initiative, is expected to generate lending up to 10 times the amount receivedor an estimated $165 million over the next four years through existing Business Oregon financing programs. Oregon small businesses interested in applying for funds can get more information at Business Oregon's Web site.
"Oregon is a small business state and improving access to capital for small business is critical to the future success of our economy," said Governor John Kitzhaber. "These awards will mean Oregon's small business can retain employees and create new jobs for Oregonians."
The funds, managed by Business Oregon, will be disbursed through the existing Oregon Business Development Fund (OBDF), the Credit Enhancement Fund (CEF) and the Capital Access Program (CAP). These three finance programs have years of proven success making direct loans to Oregon small businesses, participating in loan loss reserves programs, or issuing loan guarantees to financial institutions for the benefit of small businesses.
The programs' enhancements will create more lending opportunities for banks and credit unions as Oregon's business finance programs help mitigate some of the credit risks common to the lending environment in Oregon. Since the implementation of these loan programs, OBDF, CAP and CEF have helped make more than 3,627 loans valued at $387 million, resulting in Oregon's small businesses obtaining more than $817 million in public and private financing.
"As Oregon's economy continues to strengthen, many lenders are aggressively seeking government assistance to help mitigate collateral, cash flow and credit weaknesses in the business applications they are considering," said Business Oregon Director Tim McCabe. "This funding can go a long way toward meeting that demand and help create jobs here in Oregon."
Under the State Small Business Credit Initiative, states were offered the opportunity to apply for federal funds for programs that partner with private lenders to extend greater credit to small businesses. States had to demonstrate a reasonable expectation that a minimum of $10 in new private lending will result from every $1 in federal funding. Accordingly, the $1.5 billion funding commitment that the federal government will make for this program is expected to result in at least $15 billion in additional private lending.
The State Small Business Credit Initiative is expected to help spur up to $15 billion in lending to small businesses. Under the State Small Business Credit Initiative, participating states will use the federal funds for programs that leverage private lending to help finance small businesses and manufacturers that are creditworthy, but are not getting the loans they need to expand and create jobs. The State Small Business Credit Initiative will allow states to build on successful models for state small business programs, including collateral support programs, Capital Access Programs (CAPs) and loan guarantee programs. Existing and new state programs are eligible for support under the State Small Business Credit Initiative.
Business Oregon works to create, retain, expand and attract businesses that provide sustainable, living-wage jobs for Oregonians through public-private partnerships, leveraged funding, and support of economic opportunities for Oregon companies and entrepreneurs.