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Louisiana District Office

Louisiana District Office. AGENDA. SBA’s Mission and Purpose Programs of Assistance. SBA's Mission and Purpose. Aid Counsel Assist Protect the interests of small business concerns Support Champion small businesses. Simply put……………….

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Louisiana District Office

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  1. Louisiana District Office

  2. AGENDA • SBA’s Mission and Purpose • Programs of Assistance

  3. SBA's Mission and Purpose • Aid • Counsel • Assist • Protect the interests of small business concerns • Support • Champion small businesses

  4. Simply put……………… We help people get into business, stay in business, grow and prosper.

  5. Programs Of Assistance • Financial Assistance Programs • Non-Financial Assistance

  6. Non-Financial Assistance Programs • Government Contracting Assistance ($220B Market Place) • Prime Contracts • Subcontracting Assistance • Certificate of Competency (COC) • Size Determination • Surety Bond Program • Procurement Network (DSBS), SUB-Net, and Tech-Net • Small Business Innovation Research Program (SBIR) • Hubzone Empowerment Contracting • Business Information Centers (BICs) • Small Business Development Centers (SBDCs) • Service Corps of Retired Executives (SCORE) • Small Disadvantaged Business Certification (SDB) • Section 8(a) Business Development Program • Section 7(j) Management and Technical Assistance • BusinessLaw.gov • SBA Small Business Classroom

  7. Surety Bond Program SBA guarantees bid, performance; payment and ancillary bonds up to $2 million issued by surety companies for construction, service and supply contracts, and reimburses the sureties up to 90% of the losses sustained if the contractor defaults.

  8. Small Disadvantaged Business (SDB) To qualify as SDB, a firm must be majority owned and controlled by one or more individuals who are socially and economically disadvantaged. SBA is the Federal agency designated to certify eligible firms as SDB.

  9. HubZone Empowerment Contracting SBA encourages economic development through the establishment of preferences for award of federal contracts to small businesses located in designated HubZone areas. This fiscal year, the goal for Federal buying agencies is 3% of its procurement dollars.

  10. Eligibility Requirements • Business located in HubZone • 35% of employees reside in HubZone • 51% Unconditionally owned by U.S. Citizens

  11. Section 8(a) BusinessDevelopment Program A business development program whereby SBA has the power to obtain Federal Government contracts, and SBA, in turn, subcontracts these contracts to eligible Section 8(a) certified businesses.

  12. Section 8(a) Program General Eligibility criteria: • small business • 51% owned, controlled and daily managed by socially and economically disadvantaged individuals. • In business for at least 2 years (or obtain waiver) • Must demonstrate requisite management and technical capability • Non-minority women may be eligible

  13. Section 8(a) Program • SBA assists these firms in the growth and development of their businesses, and helps them in gaining equal access, improving their ability to compete on an equal basis in the mainstream of the American economy • Currently 150 firms in Louisiana • Participation in the program is for a maximum of 9 years.

  14. ACCESS TO CAPITAL

  15. ATTENTION!! SBA DOES NOT offer grants to start or expand small businesses, although SBA does offer a wide variety of loan programs for these purposes.

  16. Definition of a Small Business A business concern that is independently owned and operated and is not dominant in its’ field of operation, and together with its’ affiliated or subsidiary companies (if any) it does not exceed a specific size standard for its’ business industry.

  17. EXAMPLES Size Standards (in number of employees*NAICS Code Description or millions of dollars) 113210 Forest Nurseries and Gathering $ 5.0 Forest Products236620 Commercial and Industrial $31.0 Bldg. Construction237990 All Other Heavy Construction $31.0238210 Electrical Contractors $13.0238350 Carpentry Contractors $13.0332322 Sheet Metal Work Manufacturing 500332710 Machine Shops 500334111 Electronic Computer Manufacturing 1,000541410 Interior Design Services $ 6.5 541330 Engineering Services $ 4.5541320 Architectural Services $ 6.5541512 Computer Systems Design Services $23.0*North American Industry Classification System http://www.ntis.gov/yellowbk/1nty205.htm)

  18. Financial Assistance Programs • 7(a) Loan Program • SBA Express • Caplines • Export Working Capital Program (EWCP) • International Trade Loans • Small Business Investment Company (SBIC) Program • Angel Capital Electronic Network (Ace-Net) • Microloan Program • Disaster Assistance Program • 504 Loans

  19. 7(a) Guaranty Loan Program • Generally, SBA may guarantee up to $3.75 million of a loan made to a small business by a bank or non-bank lender. • The guaranty rate is 85% on loans of $150,000 or less, and 75% on loans greater than $150,000. • The guarantee SBA provides encourages the lender to make more loans to small businesses.

  20. Start-up Expansion Working Capital Inventory Machinery/Equipment Furniture/Fixtures Purchase/Construct building Business buyout Leasehold improvements Debt restructure Use Of Loan Proceeds

  21. Terms and Interest Rates • Terms and Interest Rates are negotiated between borrower and lender; however, SBA places a cap on the interest rate a lender can charge. • Typically, longer terms are given to re-pay SBA guaranteed loans. • w/c – 7yrs; equip – up to 10yrs • R.E. – 25 yrs.

  22. Fees • SBA charges the lender a nominal fee for SBA to provide the guaranty. • Origination fee allowed – no • Packaging fee allowed –yes

  23. SBA Express Loan Program • Faster, Easier, More Efficient • Maximum of $350,000 • Interest Rates -- fixed or variable, tied to prime. • Maturity may go up to 7 years with possible extension. SBA provides a 50% guarantee • Lender uses own forms

  24. PATRIOT EXPRESS PROGRAM • Maximum Loan Amount of $500,000 • Loans below $150,000 are guaranteed at 85% • Interest rates range from 2.25-4.75% over prime depending upon the size and maturity of the loan.

  25. PATRIOT EXPRESS CONT. • Eligible military community members include: • Veterans • Service-disable Veterans • Active-duty service members • Reservists and National Guard members • Current spouse of any of the above • Widowed spouse of a service member of veteran who died during service

  26. SMALL LOAN ADVANTAGE • To encourage larger lenders to make lower $ loans • Maximum: $250,000 • Guarantee: < $150k = 85%; > $150k = 75% • Approval time: 5 – 10 days • Paperwork: streamlined; 2 pg application for borrower

  27. SMALL LOAN ADVANTAGE • Lender requirements: Preferred Lenders (PLP). • SBA Form 2301 Parts A, B and C.

  28. SBA 504 LOAN PROGRAM • Fixed asset financing • 50/40/10 split • Certified Development Company (CDC) does packaging • Bank in first lien position • 10 yrs, equip.; 20 years, R.E. • CDC funds come from bond sale

  29. Microloan Program The MicroLoan Program provides small loans ranging from $100 to $50,000. Under this program, the SBA makes funds available to nonprofit intermediaries; these, in turn, make the loans. The average loan size is $10,000. Completed applications usually are processed by the intermediary in less than one week. If the borrower secures financing from another source, the loan limit is $105,000.

  30. SBA Louisiana District Office Small Business: Backbone of the Louisiana Economy according to a report by the SBA’s Office of Advocacy, small businesses clearly play a crucial role in our state’s economy. Not only do small businesses play a vital role as job creators, but their diversity and composition provide the work force with endless opportunities.

  31. What do these corporations have in common with hundreds of thousands of other businesses?

  32. They have all been helpedby theU.S. Small Business Administration!

  33. Louisiana District OfficeOne Canal Place365 Canal Street, Suite 2820New Orleans, LA 70130Telephone: (504) 589-6685Fax: (504) 589-2339 Reginald G. Harley – 504.589.2035 Vallery Brumfield – 504.589.2705

  34. Please visit our Louisiana SBA Web Site - http://www.sba.gov/la Call the SBA Answer Desk 1-800-U-ASK-SBA (1-800-827-5722) Louisiana District Office (504) 589-6685

  35. Louisiana District Office “Supporting the Formation, Growth, Prosperity, and Viability of Louisiana’s small businesses.” Thank you!!

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