Contact: Ben Nuckels, Office of the Lt. Governor, 608-266-3516
American Recovery and Reinvestment Act Loan Programs Ease Credit Crunch for Small Businesses
MADISON – Lieutenant Governor Barbara Lawton and the Small Business Administration (SBA) announced today at Wingra Boats in Madison the availability of new tools to ease the credit crunch by helping Wisconsin small businesses access capital.
“The collapse of financial markets makes it increasingly difficult for small businesses to receive payroll loans, expand inventories, or grow in ways that create new jobs,” said Lt. Governor Barbara Lawton. “These expanded SBA programs reinvest in small business prosperity by helping them access capital immediately and at cheaper rates. I am here today to urge struggling local businesses to talk to their lending institutions about these new options.”
Authorized by the American Recovery and Reinvestment Act, new appropriations enhance existing SBA loan offerings. Changes include temporarily eliminating up-front fees on short-term working capital loans (increasing the guaranty to 90%) and on fixed asset, long-term larger loans; expanding funding for the SBA microloan program through September 30th, 2010; and increasing the surety bond guarantee program for large construction projects from a maximum of $2 million to $5 million.
Lt. Governor Lawton also announced today that the America’s Recovery Capital (ARC) Business Stabilization Loans are now available for financially-vulnerable businesses in need of temporary relief to keep their doors open. This temporary SBA program will provide deferred-payment, interest-free loans of up to $35,000 to viable small businesses that need help making payments on an existing loan for up to six months. The ARC loans, which will be distributed directly by commercial lenders, are 100 percent guaranteed by the SBA and have no SBA fees associated with them.
ARC program funding is available on a first-come, first-served basis; interested businesses should contact their lending institutions immediately.
“We see three strategies playing out with this increased funding to SBA loan programs: pay the fees to get businesses to come in the door and connect to the capital they need; put banks in the mood to lend; and shore up the secondary market for the loans,” Lawton said. “Small businesses anchor their communities, circulating money locally and providing high-quality jobs for residents. We want them positioned to drive economic recovery and create new jobs.”
Madison business owner Tyler Leeper also spoke at the event. His business, Wingra Boats, received an SBA loan with its fee waived. The loan enabled him to expand his boat rental and instructional services to an additional location.
“The SBA loan allowed us to expand to a new location and expand the services we provide,” said Wingra Boats owner Tyler Leeper. “The loan was easy and inexpensive due to the fees being waived.”
Small businesses interested in learning more about these programs should visit http://www.sba.gov/ or http://www.ltgov.wisconsin.gov/.
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