Small businesses seeking investment capital can take advantage of a federal grant program that helps states provide legal, financial and accounting services.
The U.S. Department of the Treasury is making $50.8 million available through the State Small Business Credit Initiative (SSBCI). The funding mechanism was revived by the American Rescue Plan Act, which set aside $10 billion for small businesses. Over $8 billion has been approved so far.
This round of funding offers technical-assistance grants to small business organizations in 20 states. The grants will allow those organizations to support small businesses with 10 or fewer employees as well as underserved businesses.
“Today’s announcements will help unlock the potential of entrepreneurs in underserved communities across the nation who may have otherwise never had the support needed to pursue their business ideas and ambitions,” Deputy Secretary Wally Adeyemo said in a news release.
For every $1 of capital funding from the SSBCI program, the Treasury Department expects to generate $10 in private investment. Additionally, U.S. Census Bureau data showed 10.5 million new business applications were filed in 2021 and 2022.
- Arizona: $3.8 million for the Arizona Commerce Authority to offer peer support, mentorship and outreach efforts and to connect small businesses with technical assistance.
- Michigan: $5.3 million for the Michigan Economic Development Corp. to work with nine technical-assistance providers to help small businesses with financial loans and create financial statements.
- Pennsylvania: $5.5 million for the Pennsylvania Department of Community and Economic Development to offer in-person classroom and personal consulting, coaching, mentorship and peer learning groups.
- Virginia: $4.1 million for the Virginia Small Business Financing Authority to help small business owners through mentorship, workshops, job and resource fairs and community events.
The SSBI was created in 2010 and has two main programs that work in tandem. The technical-assistance grants help small businesses prepare to apply for loans and other investment capital, while the capital program connects owners with investors.
The announcement from Nov. 21 is the second round of technical assistance grant funding the Treasury Department has awarded in 2023, representing a total of $108.7 million. In August, $57.9 million went to 12 states, with California receiving the largest amount – $25.3 million.
The Treasury Department also announced another new option available to small businesses – the Investing in America Small Business Opportunity Program, which has $75 million in grants available. The department announced the available funding Oct. 25 and will publish the application and deadline at a later date.
The competitive grant program will offer funding to applicants that propose innovative ways to offer technical assistance to very small businesses and socially and economically disadvantaged individuals, or SEDI-owned businesses. Grants ideally would help these small business owners access any opportunities from the American Rescue Plan Act, the Bipartisan Infrastructure Law or other investments from legislation.
Funding is expected to benefit eight to 15 states, territories and tribes, which could receive between $5 million and $10 million each.