UTAH (ABC4) – The U.S. Department of the Treasury announced the approval of $60 million in funding for small businesses in Utah on Tuesday, October 11.
Utah’s funding comes as part of $1 billion in financing for 11 additional state plans under the State Small Business Credit Initiative (SSBCI).
The Treasury has now announced the approval of 31 state plans for approximately $4.8 billion in SSBCI funding, according to a press release.
“This is an historic investment in entrepreneurship, small business growth, and innovation
through the American Rescue Plan that will help reduce barriers to capital access for traditionally
underserved communities,” said Secretary of the Treasury Janet L. Yellen. “I’m excited to see
how these SSBCI funds will promote equitable economic growth across the country.”
The American Rescue Plan was purposed by the Biden administration to “provide direct relief to Americans, contain COVID-19, and rescue the economy.”
Utah will operate three programs as part of the initiative:
- A loan participation program (LPP)
- A loan guarantee program (LGP)
- A capital access program (CAP)
Utah reportedly allocated $27.6 million to the LPP, which will provide companion loans to enable greater extension of credit and lower blended interest rates for small business borrowers.
The LGP, for which Utah allocated $31.1 million, provides loan guarantees of up to 80% so lending partners can broaden their reach and expand access to credit.
The American Rescue Plan reauthorized and expanded SSBCI, which was originally established
in 2010 and was “highly successful in increasing access to capital for small businesses and
entrepreneurs,” according to a press release from the Treasury.
The new SSBCI reportedly builds on this successful model by providing nearly $10 billion to U.S. states, the District of Columbia, territories, and Tribal governments to increase access to capital
and promote entrepreneurship.
Officials say this is true especially in traditionally underserved communities as they emerge from the pandemic.
SSBCI funding is expected to catalyze up to $10 of private investment for every $1 of SSBCI capital funding.
A White House report found that more Americans are starting new businesses than ever before:
- In 2021, Americans applied to start 5.4 million new businesses – 20% more than any other year on record.
- Small businesses with fewer than 50 workers created 2.8 million jobs in 2021 – the highest rate of small business job creation ever recorded in a single year.
Officials say the investments being made through SSBCI are a key part of the Biden administration’s strategy to keep this small business boom going.
A press release states that the Treasury intends to continue approving state plans “on a rolling basis.”
