Small Business Jobs Act of 2010Important Deadlines Near for Small Business Lending Initiatives The Small Business Jobs Act of 2010, signed into law on September 27, 2010, contains a series of provisions designed to increase access to capital for small businesses and to provide tax breaks and other valuable resources. Deadlines are fast approaching for important initiatives of the Small Business Jobs Act. "The new law expands and enhances a number of important Small Business Administration (SBA) programs, and offers billions more in lending support, tax cuts, and other opportunities," says Jessica Farr, the Atlanta Fed's senior community development manager for the Tennessee region. "It has the potential to put significantly more capital in the hands of entrepreneurs and small business owners."
More details about the act and resulting changes follow. SBA Program Enhancements The Small Business Jobs Act aims to increase access to capital and other opportunities for small business owners. Several important components include:
SBA Advantage Loan Products The SBA is launching two new programs to increase access to capital for small business and entrepreneurs in underserved communities and to provide lower dollar loans. Both programs offer a streamlined application process for SBA 7(a) loans up to $250,000.
Small Business Lending Fund (SBLF) The SBLF is a $30 billion fund operated by the U.S. Department of the Treasury to encourage community banks to expand small business lending. The SBLF provides Tier 1 Capital to qualified community banks with assets of less than $10 billion and reduces the price a community bank pays for the Small Business Lending Fund as the bank makes more small business loans. The SBLF also includes a $300 million set-aside to be invested in Community Development Financial Institution (CDFI) loan funds. Loan funds can apply for an amount up to 5 percent of their total assets and are eligible to receive equity equivalent capital at a rate of 2 percent per year for 8 years. Additional details about the Small Business Loan Fund investments for Subchapter S corporations and CDFI loan funds will be published soon. State Small Business Credit Initiative (SSBCI) Final applications are due June 27. The SSBCI is expected to help spur up to $15 billion in lending to small businesses and manufacturers that are creditworthy, but are not getting the loans they need to expand and create jobs. Specifically, the SSBCI:
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