How will President Barack Obama’s stimulus package help the Small Business Administration provide more loans to Connecticut businesses?
The recovery act is a comprehensive package of tax breaks, financial assistance and market enhancements designed to help foster entrepreneurship and job creation. All of our existing programs have been open for business – we are providing technical assistance and training, contract help, and financing to entrepreneurs – but the recovery act will helps us increase our impact. For small businesses, the bill reduces borrowing costs to help them get loans, and offers tax credits to encourage them to start and grow their businesses and create jobs in their communities. For lenders, the bill will reduce costs, encourage new lending, and help improve liquidity so they can resume making the loans that are the lifeblood of the small business economy
Certain SBA loan programs have seen sizable drops in funding in recent years. Will the stimulus package reverse that trend?
In Connecticut, we have many community lenders who are active in commercial lending. The easier and more cost effective we make it for these local lenders to use our products, the more SBA lending they will be able to do. The stimulus bill enhancements will contribute to the lender’s liquidity and reduce their costs; and our district staff are conducting regular training and briefing sessions with our partners. These efforts will make it easier for lenders to use SBA to leverage their positions and lend more into our business communities.
How will the stimulus package benefit small businesses drowning in red ink?
One  feature of the stimulus bill creates a new SBA loan program to provide deferred-payment loans of up to $35,000 to viable small businesses undergoing immediate financial hardship that need the money to make payments on an existing, qualifying loan. The loans will be 100 percent guaranteed by SBA and repayment would not have to begin until 12 months after the loans are fully disbursed.
How many more loan opportunities can Connecticut businesses expect, compared to other parts of the country.
SBA is a federal government agency and therefore there are not any loans which are indigenous to any one state or section of the country. We in Connecticut do envision working with the Connecticut Development Authority and the Department of Economic Community Development in seeing how we can all work together for the benefit of any small business which needs capital. There is a site, www.stimuluswatch.org; there is also www.recovery.gov; can see what states have asked, where money is going.
Will the stimulus package encourage more lenders to participate in the program?
We believe that with the program enhancements and our ongoing work with lenders that yes, any lenders who have been undecided about participating with SBA will now sign on. But please know, most local community lenders already work with us, and recently several credit unions have signed on as well.