Harrisburg, July 21, 2022 – State Sen. Jim Brewster today praised the award of $268 million to Pennsylvania to be used to bolster struggling small businesses.
“One of my priorities has been the support and sustainment of small businesses and that mission became more critical and more difficult during the pandemic,” Brewster said. “The economy is recovering from the pandemic, but some entrepreneurs have found it more difficult than others. It’s good to know more help is on the way.”
The funds are part of the American Rescue Plan and will be administered through the State Small Business Credit Initiative (SSBCI), to spur small business success and job creation opportunities across the commonwealth.
The American Rescue Plan reauthorized and expanded the SSBCI, which was originally established by Congress in 2010 to provide loans and investments to underserved small businesses. As part of this reauthorization, $10 billion in funding is being allocated by SSBCI to states.
“This program will help businesses access capital in underserved communities that have met stiff barriers over the years,” Brewster said. “It’s a moral and economic imperative to make sure that hardworking people with good ideas are able to find the capital to make the dream happen. Everyone benefits.”
The Pennsylvania Department of Community and Economic Development (DCED) will distribute the new funds to eligible economic development partners who will then administer the funding to qualifying businesses in the form of equity investments and loans.
Pennsylvania will operate three different programs. The first two programs – equity capital investments and venture capital investments – have been allocated a combined total of $142 million. Direct equity investments will be made in seed and early-stage technology companies in Pennsylvania through longstanding partners Ben Franklin Technology Partners and Life Sciences Greenhouses, as well as venture capital investments in new funds under the management of underserved venture capital firms.
The third program is a loan participation program that has been allocated more than $125 million. It will extend loans of no more than 50 percent of total financing to small business borrowers through certified economic development organizations (CEDOs) and community development financial institutions (CDFIs).
Detailed guidelines will be available soon and eligible partners should visit the Pennsylvania SSBCI website for additional information as it becomes available. DCED expects to begin distributing the SSBCI funds to economic development partners this Fall.