Small businesses in Santa Clara County have a new lifeline for the new year – a low-interest loan program of up to $ 100,000, now available to qualifying establishments.
The loan program, offered by County Supervisors Joe Simitian and Susan Ellenberg, offers three- or five-year term options with a 4.25% interest rate for small businesses with 50 or fewer full-time employees. .
Eligible businesses also need revenues of less than $ 2.5 million in 2019 and a reduction of at least 25% in revenues from a previous one-year period, among other guidelines. The loan program is designed to provide quick financial support.
Approved applicants can receive their money two to three weeks after submitting their application.
“These funds are available now and are relatively easy to apply,” Simitian said. “I know people are hurting, and these funds are a step in the right direction.”
The program is made possible through a partnership with the state-owned California Rebuilding Fund, which directs capital from private, philanthropic and public sector resources to community development finance institutions to facilitate lending to local small businesses.
“We need all the state and federal help we can get, but by using those local dollars as well, we can make sure that local businesses and their employees are on the top of the list,” said Simitian.
In December, the county invested $ 6 million in the fund’s initial $ 25 million package to support small businesses in the county affected by the pandemic.
Simitian, who said he would push for additional investment at the Jan. 12 supervisory board meeting, noted that he was drawn to this particular partnership because the payback is “largely guaranteed.”
At least 95% of the loans will be repaid, regardless of the performance of the loan, according to the Simitian office.
He also noted that the quick funds make it possible to “lend money over and over again, multiplying the impact of county participation over time.” The recycled investment of county dollars could potentially fund $ 100 million in small business loans, Simitian said.
“This way I think we can be both bold and careful,” Simitian said.
Luz Urrutia, CEO of the nonprofit Accion Opportunity Fund, said the program would particularly help businesses owned by people of color, immigrants and women, who “most of whom have been left behind by federal relief efforts “.
“Small businesses have been the driving force behind every economic recovery, including paving the way out of the Great Recession,” said Urrutia. “They can do it again, but not without an intentional effort to reach and support them.”
The Santa Clara County fund launch is one of three other resources available to hurt small businesses.
The state of California has launched a $ 500 million COVID-19 relief grant program to provide grants of up to $ 25,000 to underserved small businesses and nonprofits. To find out more visit: https://business.ca.gov/.
The state legislature also approved the Main Street Hiring Tax Credit in September to provide a credit equal to $ 1,000 per qualified employee and up to $ 100,000 for eligible small business employers.
More information can be found at https://www.cdtfa.ca.gov/taxes-and-fees/SB1447-tax-credit.html. To learn more or apply for the Santa Clara County Small Business Loan Program, people can visit caloanfund.org.