SSBCI Round I Funding

In October 2010, US Congress passed and the President signed the Small Business Jobs Act.  Among other things, the act created the State Small Business Credit Initiative (SSBCI), which allowed expenditures of up to $1.5 billion for state sponsored small business finance programs.  California utilized its federal SSBCI money to capitalize three programs:  a loan guarantee program, a loan loss reserve program, and a collateral support program.

In April 2011, California entered into an SSBCI Allocation Agreement with the US Treasury for approximately $168.4 million.  The federal funds were divided evenly between the administering entities for two state credit enhancement programs, with $84,000,000 being allocated to the California Pollution Control Financing Authority (CPCFA) to establish a federally funded component to the California Capital Access Program (CalCAP) loan loss reserve program and the other half of the state allocation being allocated to the Business, Consumer Services, and Housing Agency to support a federally funded component of the Small Business Loan Guarantee Program (SBLGP), which was later transferred to the IBank under the Governor’s Reorganization Plan GRP2.

Receipt of these funds was very timely as debt markets were frozen and state resources were very limited for these two small business credit enhancement programs.  In fact, both CPCFA and BTH were short on revenues to operate their programs and had received General Fund appropriations in 2010, with $6 million being approved for CalCAP and $20 million for the Small Business Loan Guarantee Program  [AB 1632 (Budget), Chapter 731, Statutes of 2010].  In the following year, the $20 million appropriated for the SBLGP was removed and replaced with a commitment to help shore-up the account in case of financial difficulties.

Due to federal accounting practices and slight variations in federal SSBCI loss reserve and guarantee program requirements, CPCFA and the IBank each established new reserve accounts and adopted new federal versions of their programs.  Once CPCFA and the IBank received the federal funds, the program priorities for each of the programs were to use the federal funds first and leave the state funds for either nonconforming loans or for use when the federal moneys had been exhausted.

Over the course of the six program years (2011 to 2017), the state amended the federal Allocation Agreement several times, and in the latter years, CPCFA sought authorization to administer a third credit enhancement program, a Collateral Support Program.  CPCFA used the federal funds as follows:  Loss Reserve Program ($20 million) and a Collateral Support Program ($65 million).

The federal Allocation Agreement expired in March 2017.  Both CPCFA and the IBank report that all federal funds have been expended or allocated, meaning that as these moneys become unencumbered from their current loans, the moneys can be re-deployed.  As an example, funds in the Collateral Support Program could be used to continue enrolling loans under the CalCAP for Small Business program or be used to fill another small business financing gap.

Key Resources and Data

  • CA received $168.4 million out of $1.5 billion.  Overall, CA leverage these funds on a $7-to-$1 ratio.

  • SSBCI Program Evaluation 2016 - Executive Summary

  • Filling the Small Business Lending Gap:  Lessons from the U.S. Treasury's State Small Business Credit Initiative Loan Programs: Full Report

  • Information and Observations on State Venture Capital Programs - Full Report

  • Best Practices in State Venture Capital Programs - Full Report

                                                       SSBCI ANNUAL REPORTS
Release Date Title  
7/24/2017 SSBCI Summary of States Annual Report 2017

PDF 

10/19/2016 SSBCI Summary of States Annual Report 2016 PDFTransactions DatasetData Publication NarrativeData DefinitionsData DocumentationData Release Protocol
7/9/2015 SSBCI Summary of States Annual Report 2015 PDF
10/1/2014 SSBCI Summary of States Annual Report 2014 PDF 
9/25/2013 SSBCI Summary of States Annual Report 2013 PDF
source:  US Treasury SSBCI Archieves 

 

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