Late last week, the Treasury Department announced the allocation of $17 million for small business lending in the Commonwealth. The move comes at the start of the implementation of the Small Business Jobs Act which Congress recently passed into law.
Nationwide, the Act will spread $15 billion in new small business lending through innovative local programs to help entrepreneurs expand their businesses and create new jobs. This investment, over the longer term, has the potential to unleash $180 million in lending in Virginia.
The Small Business Jobs Act will spur economic growth and create 500,000 new jobs by providing much-needed lending to millions of small businesses. It offers eight new tax incentives to companies to help them expand, hire, and fuel our economy. Through the State Small Business Credit Initiative component, Virginia has the opportunity to apply for federal funding for programs that partner with private lenders to extend greater credit to small businesses. In order to qualify for the allocation, a state must demonstrate a minimum “bang for the buck”— to the tune of $10 in private lending for every $1 in federal funding. Accordingly, the $1.5 billion investment from the federal government is expected to support $15 billion in additional private lending nationwide.
In addition to the State Small Business Credit Initiative, the Small Business Jobs Act will help America’s 27 million small businesses with eight tax cuts totaling $12 billion that went into effect last week. It will make Main Street businesses more competitive with big corporations by spurring up to $300 billion in private sector lending for small businesses through community banks and extending and expanding existing Small Business Administration low-cost loans.
Small businesses are the engine of our economy and key to creating American jobs and building the economy for the future. By increasing access to capital here in the Commonwealth, we can see to it that Virginia remains one of the very best places to start and grow a business.
Rep. James Moran (D) is Virginia’s 8th Congressional District Representative in the U.S. House of Representatives.