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The Patriot Express Pilot Loan Initiative
("PEPLI") is available to able-bodied and
service-disabled veterans or their spouses,
military who are actively serving in the
Transition Assistance Program or their
spouses, members of the United States
Reserves and the Army National Guard or their
spouses, or widows of veterans or servicemen
who died while serving the United States or
from a service-related disability.
Under PEPLI, individuals who qualify for this initiative may receive up to $500,000 in loans. Loans may be used for a variety of business-related expenses, which include: costs for starting and expanding the business, capital, equipment purchases, inventory and certain types of real estate purchases. According to the U.S. SBA, PEPLI's loans provide the lowest interest rate for business loans, from 2.25% to 4.75% over prime. Individuals may contact the local SBA district office to learn more about PEPLI and area lenders. |
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The America's Recovery Capital ("ARC") loan
program is a temporary program established by
the American Recovery and Reinvestment Act
("the Recovery Act") to provide existing,
"viable" small businesses which are facing
immediate financial hardship, such as a
decline in sales or difficulty meeting
operating expenses, temporary financial
relief so that they may regain their
financial footing.
Under the ARC loan program, a financial hardship that qualifies a business for this loan may include a reduction in the businesses' customer base, an increased cost of doing business, reduced capital, reduced short-term credit, credit restrictions which prevent the business from meaningfully restructuring its debt, a reduction in the businesses' workforce, and a reduction of its major suppliers. Businesses eligible for a loan under the ARC program must meet the following criteria: they must be established, they must produce financial statements which show profits made in the past year or two, and they must project cash flow to meet current loan payments and payments two-years from the date of the loan's approval. Start-up businesses are not eligible for ARC loans. Businesses that obtain ARC loans may pay the principal and the interest on one or more qualifying small business loans with ARC loan funds for a six month period. The purpose of permitting this use is to allow businesses to invest funds they would otherwise spend on paying these small business loans on essential operating costs, such as buying inventory and paying employees. Under the ARC loan program, borrowers are not charged interest, and ARC loans are 100 percent guaranteed to lenders. Additionally, principal repayment is deferred 12 months from the date of the last loan disbursement. SBA lenders will only offer ARC loans until funding runs out or September 30, 2010, whichever is first. |
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Under the Recovery Act, the federal
government is providing $74 million dollars
in additional funding to the U.S. SBA
microloan program, which provides loans under
$500 and up to $35,000, as well as technical
assistance, to start-up small businesses. Of
the $74 million dollars, $50 million is
allocated for the loans, while $24 million
will go toward technical assistance training.
This program targets borrowers with little or no credit history, low income borrowers, and women and minority borrowers who do not qualify for conventional loans. Loans are made for capital, machinery, equipment, inventory and improvements. The infusion of funding to the microloan program allows lenders to provide additional technical assistance and loans to area small businesses. For more information on the SBA's microloan program, go to http://www.sba.gov/idc/groups/public/documents/sba_homepage/recovery_act_microloans.pdf. |
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Businesses that apply for federal grants
require a D-U-N-S, or "data universal
numbering system" number.
A D-U-N-S number is a nine-digit number that provides identifying information about the business entity to which it is assigned. The Federal Government's Office of Management and Budget ("OMB") began requiring D-U-N-S numbers from businesses applying for federal grants on or after October 1, 2003, as a way to monitor how federal grant monies were being spent. Businesses may register for a D-U-N-S number by calling 1-866-705-5711, or on the web at http://fedgov.dnb.com/webform. Applicants may be asked to provide the legal name of the business, the business's physical and internet addresses, its telephone number, the name of the its authorizing agent, its business purpose, and the number of people that it employs. |
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Congress is considering a health insurance
exchange program as part of its health care
reform initiative. By creating a pool of as
many as 30 million American insurance
consumers, the participants in the exchange
would have an opportunity to choose from a
variety of insurance plans. In turn, the
insurance premiums offered through the
exchange would likely be lower than rates
these individuals or small businesses would
otherwise secure.
A number of logistical issues must be addressed if the plan is to work effectively. Under the House of Representatives' health care plan, small business employees could choose to be covered by any of the plans participating in the exchange. However, this may require employers to issue checks to each plan for each employee. Arguably, it would be more efficient to pay the exchange for the business's share of the coverage, and have the exchange further disburse the funds. Reconciling the House bill with the Senate bill may result in unforeseen changes. Under the current Senate bill, the CBO estimates that individuals will pay 10-13% more than if no legislation was enacted. In light of Massachusetts' Senator Scott Brown's recent election to Congress, the future of health care reform seems uncertain. Nevertheless, if Congress proceeds to adopt a health care reform bill which provides for health insurance exchanges, the success of the exchange will, in no small part, depend on how the exchange is implemented - a method which, as yet, is undetermined. |
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