What We Will be Talking About

1
U.S. Small Business Administration

• What We Will be Talking About
• - SBA Overview Information at www.sba.gov/mn
• - American Recovery and Reinvestment Act

2
U.S. Small Business Administration

• SBA Products and Services
• - Counseling and Training
• - Financial Assistance
• - Government Contracting
• - Disaster Recovery

3
U.S. Small Business Administration

• Training Counseling Programs
• Business Planning Center
• The SCORE Association
• Small Business Development Centers
• - Womens Business Centers
• - Online Training.

4
Business Planning Center

• Free service specializing in preparation of
  business plans.
  
• Clients use business Plan Pro at the center.
• Loan Seminar Thursdays 1230 200
• Loan Officer Thursdays 230 600
• Legal Corps Tuesdays 400 700

2324 University Ave. St. Paul 651-209-1884
5
U.S. Small Business Administration

• SCORE Association
• Free one on one counseling.
• Workshops and Training.
• Emphasis on Start-ups.
• Six SCORE Chapters In MN
• - SCORE Website www.score-mn.org.

6
U.S. Small Business Administration

• Minnesota Small Business Development Centers
• Partnership between SBA and DEED
• Centers are located throughout MN.
• Free (to you) confidential one on one counseling
  with a professional consultant.
  
• Workshops and Seminars.
• Emphasis on existing businesses.
• SBDC Website www.mnsbdc.com.

7
Womens Business Centers
WomenVenture St. Paul, MN Northeast Entrepren
eur Fund Virginia, MN

• Focus on training programs for women
• Mentoring programs
• Offer SBAs Microloan program
• Clients receive intense one-on-one
  counseling
  
• Client base is usually start-up

Helping you start, grow and succeed.
8
U.S. Small Business Administration

• Online Training
• Small Business Training Network.
• Information on SBA Programs and Services.
• Free online courses
• Website www.sba.gov/training

9
U.S. Small Business Administration

• Financial Assistance Programs
• 7(a) Loan Program
• SBA Express
• Micro Loans
• 504/Certified Development Company

10
U.S. Small Business Administration

• 7(a) Loan Program
• SBAs Flagship Program.
• SBA provides loan guarantee to banks making small
  business loans.
  
• Borrower works with bank.
• Bank works with SBA.
• Guaranteed percentage 75-85
• Under Recovery Act 90.
• Borrower pays guarantee fee of 2-3.75 (on
  guaranteed portion only)
  
• Currently fee eliminated under the Recovery Act.

11
U.S. Small Business Administration

• SBA Express
• Maximum loan amount 350,000.
• Maximum Guaranty 50.
• Uses Revolving line of credit or term loan.
• Borrower pays guarantee fee of 2-3 (on
  guaranteed portion only)
  
• Currently fee eliminated under the Recovery Act.

12
U.S. Small Business Administration

• Micro Loans
• SBA provides funding to non-profit community
  based intermediary lenders.
  
• Five intermediaries in MN
• Micro loans requires technical assistance.
• Maximum loan amount 35,000.
• No SBA guarantee or guarantee fees.

13
U.S. Small Business Administration

• 504/Certified Development Company
• Long term fixed-asset lending.
• Typical source of funding
• 50 non-guaranteed from lender.
• 40 from CDC funded by 100 guaranteed
  debentures.
  
• 10 from small business or other non-federal
  source.
  
• Debentures pooled and sold to private investors.
  
  
• Six 504/Certified Development Companies in MN
• 504 loans may have lower interest rate and longer
  term than traditional financing.
  
• CDC Processing Fee 1.5 of debenture eliminated
  under the Recovery Act.

14
U.S. Small Business Administration

• Government Contracting
• Recovery Act provides additional opportunities
  process the same.
  
• 8(a) Business Development Program
• HUBZone Program
• SADBOC Government Procurement Fair

15
U.S. Small Business Administration

• 8(a) Business Development Program
• Eligibility
• Social Disadvantage
• Economic Disadvantage
• Application Process
• Business apply on-line at www.sba.gov/8abd
• Nine year program
• Training
• Government contract support
• Mentor Protégé program

16
U.S. Small Business Administration

• HUBZone Program
• Eligibility Requirements
• Principal office in HUBZone
• 35 of employees reside in HUBZone
• Must be small
• 51 owned by U.S. Citizens
• Mapping software and online application at
  www.sba.gov/hubzone
  
• Certified HUBZone firms may receive preferences
  in government contracting
  

17
U.S. Small Business Administration

• Disaster Recovery
• SBA makes direct low interest loans
• Small Businesses
• Homeowners
• Recent Minnesota Disasters
• Flooding in Moorhead
• Flooding in SE Minnesota
• 35W Bridge
• - Economic Injury Disaster Loans

18

• American Recovery and
• Reinvestment Act

19
U.S. Small Business Administration

• American Recovery and
• Reinvestment Act Highlights
• Temporary Elimination of Loan Fees.
• Temporary 90 Percent Guarantees.
• Secondary Market Liquidity.
• ARC Loan Program.
• Expanded Micro loans.
• Surety Bond Program Expansion.

20
Temporary Fee Eliminations
U.S. Small Business Administration

• Temporary fee eliminations for borrowers on 7(a)
  loans (including SBA Express) and for both
  borrowers and lenders on Section 504 loans.
  
• The fee eliminations are retroactive to Feb. 17,
  2009, the day the Recovery Act was signed. 

21
U.S. Small Business Administration

• Temporary 90 Percent Guarantees
• Guarantees to up to 90 percent on most types of
  7(a) loans to qualified small businesses.
  

22
U.S. Small Business Administration
TARP (Secondary Market)

• Up to 15 billion in TARP funds to unfreeze the
  small business lending market.
  
• Treasury will purchase existing and new
  SBA-backed loans made by community banks, credit
  unions and other small lenders.
  
• Guaranteed portion of most 7(a) loans
  (50-75-85-90 guarantees) and 504 first
  mortgage loans (not guaranteed) are eligible.
  

23
7(a) Secondary Market Liquidity
U.S. Small Business Administration

• SBA will assist broker-dealers purchasing
  SBA-guaranteed 7(a) loans from lenders.
  
• This program will help restore the secondary
  market for 7(a) loans.
  

24
Americas Recovery Capital (ARC) Loan Program
U.S. Small Business Administration

• Designed for viable small businesses that need
  help making payments on existing, qualifying
  loans for up to six months.
  
• Maximum loan 35,000.
• 100 percent guarantee by SBA.

25
U.S. Small Business Administration
Americas Recovery Capital (ARC) Loan Program

• Deferred payments repayment begins 12 months
  after final disbursement.
  
• Interest paid by SBA under the Recovery Act.
• CANNOT cover payments on existing SBA loans
  approved before Feb. 17, 2009.
  
• Scheduled availability June 15.

26
Expanded Microloans
U.S. Small Business Administration

• Extra funding for SBA-backed micro lenders.
• Enough for 50 million in new SBA micro loans.
• Loans up to 35,000.
• Technical assistance, training for every
  borrower.
  
• Entrepreneurs can apply immediately.

27
Surety Bond Program Expansion
U.S. Small Business Administration

• Raises maximum contract amount covered by SBA
  surety bond guarantee from 2 million to 5
  million.
  
• Expands up to 10 million under certain
  contracts.
  
• Helps small businesses better compete for
  contracts.
  

28
Minnesota Lending Trends Loan Approvals /
Dollars May 2007 April 2009
U.S. Small Business Administration
29
U.S. Small Business Administration
30
U.S. Small Business Administration
31
U.S. Small Business Administration

• Questions?
• Randall Czaia
  Assistant District Director 8(a)
  Business Development [phone]
  randall.czaia_at_sba.gov