Deadline to Secure New Federal Funding Promoting Small Businesses Imminent
Southern Legislative Conference of The Council of State Governments
The federal Small Business Jobs Act of 2010 is designed to generate critical resources to help small businesses drive economic recovery and create jobs. An important component of this new legislation involves the State Small Business Credit Initiative (SSBCI), a formula grant program structured to assist local entrepreneurs and small business owners secure the necessary credit to expand their businesses, create jobs and generate revenue. Specifically, the SSBCI provides $1.5 billion in federal funding to states to initiate programs that expand credit opportunities for small businesses. State commitment to involve the private sector in implementing these programs remains a critical element of the SSBCI, and states are required to demonstrate and help facilitate $10 in new private lending for every $1 in federal funding. In total, it is anticipated that the $1.5 billion federal commitment will lead to a minimum of $15 billion in additional private sector lending to spur small businesses.
Given the urgency relating to releasing credit to worthy small business operations to drive economic growth, there are a number of tight deadlines associated with states accessing the SSBCI funds. These deadlines include the following:
Of note, if a state fails to file a Notice of Intent (by November 26, 2010) or an Application (by June 26, 2011), municipalities in the state have until September 26, 2011, to present the necessary paperwork for accessing SSBCI funds in lieu of the state. In addition, while small businesses are the sole beneficiaries of these SSBCI funds, states may contract with not-for profit and for-profit organizations to actually implement the programs.
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