January 16, 2014
FRANKFORT, Ky. – Governor Steve Beshear announced today that Kentucky has secured an additional $5.1 million for the state’s small businesses through a second disbursement from the U.S. Treasury Department’s State Small Business Credit Initiative (SSBCI).
“What a great way to kick off 2014,” said Gov. Beshear. “We’re pleased that our success is being rewarded with additional funding to support the growth of our small business community. By working with our financial institutions, we hope to leverage these funds with private capital to generate more investment and more jobs for Kentucky’s economy.”
The credit initiative is an innovative financing option that works in partnership with participating lenders. Lenders can use three Kentucky-specific credit enhancement options to strengthen loan requests that are credit-worthy in nature but fall just outside acceptable underwriting standards. The credit initiative bridges the gap, making it possible for lenders to finance more small businesses.
The Commonwealth was awarded a total allocation of $15.4 million through the U.S. Department of the Treasury’s SSBCI program in July 2011, and is receiving the funding in three separate disbursements. Kentucky is receiving its second disbursement after expending $4.218 million (82.5 percent) of its first disbursement to support loans to small businesses. To date, the federal funds have generated $37 million in private sector financing to Kentucky companies.
Kentucky’s SSBCI funding is administered by the Cabinet for Economic Development’s Office of Entrepreneurship.
“We are thankful for these funds that enable our small businesses to leverage new capital and create more jobs,” said Cabinet for Economic Development Secretary Larry Hayes. “The program’s successful deployment shows that our economy and our businesses remain dynamic and are moving in the right direction.”
The SSBCI program was established in 2010 when President Barack Obama signed into law the Small Business Jobs Act. Through SSBCI, the U.S. Department of the Treasury awarded almost $1.5 billion nationwide to fund programs that support small businesses and small manufacturers. The program is expected to spur up to $15 billion in new private sector lending or investment in small companies by leveraging $10 in private capital for every dollar of federal support by the program’s end.
“The first disbursement of SSBCI funds has allowed us to support nearly 50 small business projects throughout the state,” said Sec. Hayes. “We hope to build on this momentum by engaging even more financial services partners to put this funding to work in the community.”
Businesses and lenders may obtain more information about the Kentucky Small Business Credit Initiative at www.thinkkentucky.com/smallbizlending
Information on Kentucky’s economic development efforts and programs is available at www.ThinkKentucky.com. Fans of the Cabinet for Economic Development can also join the discussion on Facebook at www.Facebook.com/ThinkKentucky or follow on Twitter at www.Twitter.com/ThinkKentucky.