State Small Business Credit Initiative

Mission Statement

To increase the availability of credit for small business, to generate jobs and other economic 

development benefits for states, Treasury has implemented the State Small Business Credit 

Initiative. 

Program Summary by Budget Activity

Dollars in Thousands

FY 2011 and 2012 Priorities

 To provide direct funding support to states for use in programs designed to increase 

access to credit for small businesses.

 To support state capital access programs (CAPs) and other credit support programs 

(OCSP) that support lending to small businesses and small manufacturers.

FY 2010 FY 2011 

Outlays Estimated Estimated Estimated $ Change % Change

SSBCI Program $0 $487,000 $732,000 $245,000 50.31%

Administration 0 6,410 7,488 $1,078 16.82%

Total Outlays $0 $493,410 $739,488 $246,078 49.87%

Total FTE 0 9 12 3 33.33%

FY 2012
SSBCI - 2

Table of Contents

Section 1 – Purpose ..................................................................................................................3

1A – Description of Vision and Priorities ...................................................................... 3

Section 2 – Budget Adjustments and Appropriation Language..........................................5

Section 3 – Budget and Performance Plan ............................................................................6

3.1 – Budget by Strategic Outcome ................................................................................ 6

3.2.1 – State Small Business Credit Initiative Program Budget and Performance Plan. 7

3.2.2 – State Small Business Credit Initiative Administration Budget and Perf. Plan ... 7
SSBCI - 3

Section 1 – Purpose 

1A – Description of Vision and Priorities 

The State Small Business Credit Initiative was created to fund new and existing state programs 

that support lending to small business in order to stimulate economic growth and new jobs.

Vision: Under the State Small Business Credit Initiative, participating states will use the federal 

funds for programs that leverage private lending to help finance small businesses and 

manufacturers that are creditworthy, but are not getting the loans they need to expand and create 

jobs. The State Small Business Credit Initiative will allow states to build on successful models 

for state small business programs, including CAPs, collateral support programs, and loan 

guarantee programs. 

Priorities: 

 

 To provide direct funding support to states for use in programs designed to increase 

access to credit for small businesses.

 To support state CAPs and other credit support programs (OCSP) that support lending to 

small businesses and small manufacturers.

1B – Program History and Future Outlook 

On September 27, 2010, President Obama signed into law the Small Business Jobs Act of 2010 

(the "Act"). Section 3003 of the Act authorizes and directs the Secretary of Treasury to establish 

a seven-year State Small Business Credit Initiative, which was funded with $1.5 billion to 

support state programs that support lending to small businesses and small manufacturers. The 

State Small Business Credit Initiative is expected to support new small business lending through 

local programs that help entrepreneurs expand their businesses and create new jobs. 

Under the State Small Business Credit Initiative, states are offered the opportunity to apply for 

federal funds for programs that partner with private lenders to extend greater credit to small 

businesses. States are required to demonstrate a reasonable expectation that a minimum of $10 in 

new private lending will result from every $1 in federal funding. Accordingly, the $1.5 billion 

funding commitment that the federal government will make for this program is expected to result 

in $15 billion in additional private lending. 

The State Small Business Credit Initiative allows states to build upon existing, successful statelevel small business lending programs, including examples such as CAPs, collateral support 

programs, and loan guarantee programs. 

 Capital Access Programs: CAPs, which are already up and running in over 20 states, are 

loan portfolio insurance programs in which states provide a matching contribution to 

bank loan loss reserves when lenders extend credit to qualified small businesses. These 

reserve enhancements allow lenders to expand credit to new borrowers at a time when 

many of these lenders might otherwise pull back. 
SSBCI - 4

 Collateral Support Programs for Small Manufacturers: Collateral support programs help 

viable businesses that are struggling to get credit because the value of the collateral they 

hold has fallen, often due to the decline in commercial real estate values. These programs 

– which set aside funds to augment collateral the borrower already holds – provide banks 

greater confidence in extending credit to these borrowers, particularly in some of the 

communities hardest hit by the economic downturn. 

 Loan Guarantee Programs: Under loan guarantee programs, states provide partial 

guarantees on small business loans to give lenders greater confidence to extend credit. 

If a state does not have an existing small business lending program, officials can establish one in 

order to access this funding. 

The funding a state is eligible to apply for is determined based on formulas in the Small Business 

Jobs Act that take into account each state's unemployment rate and decline in employment 

relative to other states. Pursuant to the Act, funds are allocated to all fifty States along with the 

District of Columbia, the Commonwealth of Puerto Rico, the Commonwealth of Northern 

Mariana Islands, Guam, American Samoa, and the United States Virgin Islands. If a State did 

not file a timely Notice of Intent or fails to meet the application deadline, municipalities within 

that State may apply for their pro rata share of the State's allocation, provided that such 

municipalities can meet all the program criteria. Up to three municipalities within a State may be 

eligible to receive SSBCI funds.

Treasury estimates that it will make at least one-third of the total $1.5 billion in payments in FY 

2011 and most of the remaining funds in FYs 2012 and 2013. In addition, less than 3% of the 

appropriation has been allocated to administrative expenses. The administrative costs will be 

expended over the seven-year life of the program.
SSBCI - 5

Section 2 – Budget Adjustments and Appropriation Language

2.2 – Operating Levels Table

Dollars in Thousands

2A – Enacting Legislation

The Small Business Jobs Act of 2010 (P.L. 111-240).

2B – Legislative Proposals

There are no current proposals for amending the enacting legislation.

State Small Business Credit Initiative FY 2010 

Obligated

FY 2011 

Estimated

F

Y 

2

FY 2012 

Estimated

FTE - 9 12

Object Classification:

11.1 Full-Time Permanent Positions..................................... $0 $1,077 $1,498

12.0 Personnel Benefits...................................................................... 0 378 526

21.0 Travel.................................................................................. 0 155 155

25.1 Advisory & Assistance Services.................................................... 0 3,100 3,566

25.3 Purchase of Goods/Serv. from Govt. Accts...... 0 1,700 1,743

41.0 Grants, Subsidies........................................................... 0 487,000 732,000

Total................................................ $0 $493,410 $739,488

Activities:

SSBCI Program 0 487,000 732,000

Administration 0 6,410 7,488

Total................................................ $0 $493,410 $739,488
SSBCI - 6

Section 3 – Budget and Performance Plan

This table lists FYs 2011-2012 resources by strategic goal, objective and outcome outlined in the 

FY 2007-2012 Treasury Department Strategic Plan. For detailed information about the FY 

2007-2012 Treasury Strategic Plan, please go to: http://www.treasury.gov/about/budgetperformance/strategic-plan/Documents/strategic-plan2007-2012.pdf

3.1 – Budget by Strategic Outcome

Dollars in Thousands

3A – State Small Business Credit Initiative Program ($732,000,000 in FY 2012): On 

September 27, 2010, President Obama signed into law the Small Business Jobs Act of 2010 (the 

"Act"). Section 3003 of the Act authorizes and directs the Secretary of Treasury to establish a 

seven-year State Small Business Credit Initiative, which was funded with $1.5 billion to support

state programs that support lending to small businesses and small manufacturers. The State 

Small Business Credit Initiative is expected to support new small business lending through 

innovative local programs that help entrepreneurs expand their businesses and create new jobs. 

Under the State Small Business Credit Initiative, participating states will use the federal funds 

for programs that leverage private lending to help finance small businesses and manufacturers 

that are creditworthy, but are not getting the loans they need to expand and create jobs. The 

State Small Business Credit Initiative will allow states to build on successful models for state 

small business programs, including CAPS, collateral support programs, and loan guarantee 

programs. Existing and new state programs are eligible for support under the State Small 

Business Credit Initiative.

The funding a state is eligible to apply for is determined based on formulas in the Small Business 

Jobs Act that take into account each state's unemployment rate and decline in employment 

relative to other states. Pursuant to the Act, funds are allocated to all fifty States along with the 

District of Columbia, the Commonwealth of Puerto Rico, the Commonwealth of Northern 

Mariana Islands, Guam, American Samoa, and the United States Virgin Islands. If a State did 

not file a timely Notice of Intent or fails to meet the application deadline, municipalities within 

that State may apply for their pro rata share of the State's allocation, provided that such 

municipalities can meet all the program criteria. Up to three municipalities within a State may be 

eligible to receive SSBCI funds.

Treasury Strategic Outcome FY 2011 

Estimated

FY 2012 

Estimated

Prevented or mitigated financial and economic crises $493,410 $739,488 49.9%

Total $493,410 $739,488 49.9%

Percent 

Change
SSBCI - 7

3.2.1 – State Small Business Credit Initiative Program Budget and Performance Plan

Performance metrics are currently in development for the State Small Business Credit Initiative 

and will be finalized in 2011. 

3B – Administration ($7,488,000 in FY 2012): The authority to pay administrative expenses is 

provided by Section 3009 (b) of the Act which appropriates $1.5B to carry out the state small 

business credit program "including to pay reasonable costs of administering the program." 

Administrative expenses include the costs of government employee salaries, contract support,

and reimbursement to the Treasury Office of Inspector General for program audits.

3.2.2 – State Small Business Credit Initiative Administration Budget and Performance Plan

Performance metrics are currently in development for the State Small Business Credit Initiative 

and will be finalized in 2011. 

SSBCI Program

FY 2008 

Actual

FY 2009 

Actual

FY 2010 

Estimated

FY 2011 

Estimated

FY 2012 

Estimated

SSBCI Program Outlay Levels $0 $0 $0 $487,000 $732,000

Total Program Outlay Levels $0 $0 $0 $487,000 $732,000 

(Dollars in Thousands)

Administration

FY 2008 

Actual

FY 2009 

Actual

FY 2010 

Estimated

FY 2011 

Estimated

FY 2012 

Estimated

Administration Outlay Levels $0 $0 $0 $6,410 $7,488

Total Administration Outlay Levels $0 $0 $0 $6,410 $7,488 

(Dollars in Thousands)