State Small Business Credit

Initiative

FY 2017

President’s Budget

February 9, 2016
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Table of Contents

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

1A – Mission Statement ...................................................................................................................3

1.1 – Resource Detail Table .............................................................................................................3

1B – Vision, Priorities and Context..................................................................................................3

Section 2 – Budget Adjustments and Appropriation Language ....................................................7

2.1 – Budget Adjustments Table ......................................................................................................7

2A – Budget Increases and Decreases Description ..........................................................................7

2.2 – Operating Levels Table ...........................................................................................................8

2B – Appropriations Language and Explanation of Changes ..........................................................8

2C – Legislative Proposals...............................................................................................................8

Section 3 – Budget and Performance Plan.......................................................................................9

3A – State Small Business Credit Initiative Program ......................................................................9

3.1.1 – State Small Business Credit Initiative Program Budget and Performance Plan.................10

3B – State Small Business Credit Initiative Administration ..........................................................11

3.1.2 – State Small Business Credit Initiative Administration Budget and Performance Plan ......11

Section 4 – Supplemental Information...........................................................................................12

4A – Summary of Capital Investments...........................................................................................12
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Section 1 – Purpose 

1A – Mission Statement

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

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

Credit Initiative (SSBCI).

1.1 – Resource Detail Table

1B – Vision, Priorities, and Context

SSBCI funds new and existing state programs that support lending to and investment in

small businesses to stimulate economic growth and new jobs. Under SSBCI, participating

states 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 and 

investments they need to expand and create jobs.

The Small Business Jobs Act of 2010 (the Act) authorized and appropriated $1.5 billion for 

SSBCI through FY 2017. Due to the success of SSBCI, the FY 2017 President’s Budget 

proposes a new authorization of $1.5 billion to build on the momentum of the program’s first 

round, strengthen the federal government’s relationships with state economic development 

agencies, and provide capital to America’s diverse community of entrepreneurs. The new 

authorization would run from FY 2017 through FY 2023.

SSBCI allows states to build on successful models for state small business lending and investment 

programs, including capital access programs (CAPs), collateral support programs, loan guarantee

programs, loan participation programs, and venture capital programs. 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 over the life of the program. SSBCI aligns with Treasury’s 

strategic goal to promote domestic economic growth and stability while continuing reforms of the

financial system.

Dollars in Thousands

State Small Business Credit Initiative

Budgetary Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Budgetary Resources:

Recovery from Prior Years - 1,908 - - - - - - 0.00% 0.00%

Offsetting Collections - 605 - - - - - - 0.00% 0.00%

Unobligated Balances from Prior Years - 19,323 - 15,483 - 8,780 - (6,703) 0.00% -43.29%

Subtotal Budgetary Resources - 21,836 - 15,483 - 8,780 - (6,703) 0.00% -43.29%

Other Resources:

SSBCI Program - - - - - - - - 0.00% 0.00%

SSBCI Administration 9 6,353 9 6,703 9 6,327 - (376) 0.00% -5.61%

Subtotal Other Resources 9 6,353 9 6,703 9 6,327 - (376) 0.00% -5.61%

Net Results 9 15,483 9 8,780 9 2,453 - (6,327) 0.00% -72.06%

Actual Estimated $ Change % Change

FY 2015 FY 2016 FY 2017 FY 2016 to FY 2017

Estimated
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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 that support lending to and 

investment in small businesses and small manufacturers.

• To monitor the deployment of SSBCI funds among approved state programs and to ensure 

adherence to all Treasury compliance standards.

• To promote best practices in program design, operations, and marketing among state-run 

programs.

• To provide technical assistance to states as they implement these programs and deploy funds 

to eligible small businesses.

SSBCI Program Activities

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

(the Act). Section 3003 of the Act authorized and directed the Secretary of the Treasury to

establish a seven-year SSBCI, which was funded with $1.5 billion to support state programs that 

support lending to small businesses and small manufacturers. Since the passage of the Act, 

SSBCI has positively impacted small business access to capital and local economies around the 

nation, supported over 12,400 private sector loans or investments to small businesses, and helped 

create or retain over 140,000 jobs, as reported by the small businesses who received the loans and 

investments

1

.

Proposal for Extension

The FY 2017 President’s Budget proposes a new authorization of SSBCI to build on the

momentum of the program’s first round of funding, strengthen the federal government’s 

relationships with state economic development agencies, and provide capital to America’s diverse

community of entrepreneurs. The budget proposes extending SSBCI with a new authorization of

$1.5 billion awarded in two allocations: $1 billion awarded on a competitive basis to states best 

able to target local market needs, promote inclusion, attract private capital for start-up and scaleup businesses, strengthen regional entrepreneurial ecosystems, and evaluate results; and 

$500 million awarded by a need-based formula.

Program Activity to Date

Under SSBCI, states were offered the opportunity to apply for federal funds for programs that 

support private lending and investing to small businesses. SSBCI allows states to build upon 

existing, successful state-level small business lending and investing programs, such as CAPs, 

collateral support programs, loan participation programs, loan guarantee programs, and statesponsored venture capital programs. If a state did not have an existing small business program, the

state could establish one in order to access this funding.

1 Source for transaction and job creation and retention figures is the annual report data submitted by states for the 

periods ending December 31, 2011 through December 31, 2014.
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As of September 30, 2015, all program participants reported expending or obligating SSBCI

funds to support loans or investments in businesses. As of the same date, Treasury had outlayed 

to states approximately $1.36 billion or 94 percent of the total funds available for disbursement. 

Treasury expects states to qualify to receive most of the remaining funds in FY 2016. States 

report transaction details to Treasury annually. Data through December 2014, when states

expended $864 million in SSBCI funds to leverage $6.4 billion in new financing, suggest the

following key findings:

• SSBCI funds have supported thousands of loans and investments that might not

otherwise have been made to small businesses in a wide range of sectors. SSBCI 

financing reached small businesses in industries ranging from retail trade to 

manufacturing, hospitality, and many types of services. Nearly two-thirds of all SSBCI 

loans or investments supported by SSBCI were for less than $100,000, and the average

loan or investment size was $369,000.

• SSBCI funds have helped create or save more than 140,000 American jobs. The small 

business owners who received financing expect that the loans and investments they received 

will create over 48,000 jobs within two years and help retain more than 92,000 jobs that 

were at risk of loss.

• SSBCI funds support businesses with the highest potential to create new jobs. More

than half of all SSBCI loans or investments went to young businesses less than five years 

old, which economic research by the Kauffman Foundation suggests are more likely to 

create new jobs than similarly-sized businesses that are farther along in their development. 

Nearly 80 percent of all SSBCI loans and investments went to businesses with 10 or fewer

employees.

• Forty-two (42) percent of SSBCI loans and investments were made to businesses in

low- and moderate-income communities with incomes at or below 80 percent of the

area median income. SSBCI has been effective in supporting small businesses in areas that 

were hit hardest by the recession and where the need is greatest.

• Through 2014, SSBCI operations had generated $7.36 in new small business lending 

or investing for every $1 of federal support. Private sector leverage is expected to 

increase before the program concludes.

• SSBCI has helped create more than 87 new small business support programs, which

account for 54 percent of the programs currently disbursing SSBCI funds. Through the

availability of SSBCI funds, a new infrastructure of state-operated credit support programs 

has been created across the country.

States were eligible to apply for funds that were allocated by formula in the Act based on each 

state’s decline in employment relative to the overall national decline. Pursuant to the Act, funds 

were available to all 50 states, the District of Columbia, the Commonwealth of Puerto Rico, the 

Commonwealth of the Northern Mariana Islands, Guam, American Samoa, and the United 

States Virgin Islands. In the event a state chose not to participate in SSBCI, municipalities in 

that state could apply for the state’s allocation. Ultimately, 47 of 50 states applied to participate

in SSBCI (North Dakota, Wyoming, and Alaska did not participate).

Through FY 2014, Treasury had approved a total of 57 allocations to 47 states, the District of 

Columbia, five U.S. territories, and four municipalities (or consortia of municipalities) from 
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Alaska, North Dakota, and Wyoming. Once approved, all funding for each respective entity is 

allocated. Treasury transfers funds to participating states in three disbursements. 

Outlays occur as the participating states expend, obligate, or transfer the funds and submit

disbursement requests to Treasury. In addition, less than three percent of the appropriation 

has been allocated to Treasury administrative expenses, which also covers administrative

expenses of the Office of the Inspector General dedicated to auditing the use of SSBCI funds. 

Treasury will expend administrative costs over the seven-year life of the program.

FY 2017 Program Activity

In FY 2017, the last year of existing program authority, SSBCI will continue to monitor

compliance and provide technical assistance to states and respond to OIG audits of states’ use of 

SSBCI funds. Additionally, Treasury will publish an evaluation of the first five years of the 

SSBCI program.

In FY 2017, Treasury proposes to administer a new SSBCI authorization of $1.5 billion 

awarded in two parts: $1 billion to be awarded on a competitive basis to states for applications 

that demonstrate the greatest potential impact and $500 million allocated to states according to 

a need-based formula. Potential categories being considered for competitive scoring include a 

state’s ability to target local market needs, promote inclusion, attract private capital for startup and scale-up businesses, strengthen regional entrepreneurial ecosystems, and evaluate

results, among other factors. During FY 2017, SSBCI would administer the formula award 

process and initiate the competitive award process. Treasury estimates outlays to states of

$212 million in FY 2017 and remaining outlays under Round 2 occurring between FY 2018 

and FY 2021.

Office of the Inspector General (OIG) Activities

In FY 2017, OIG will continue to provide audit and investigative oversight of SSBCI. The

authorizing legislation directs OIG to audit the use of SSBCI funds by participating states so 

that Treasury can recoup any recklessly or intentionally misused funds identified by such

audits.

The FY 2017 budget request will support 11 OIG employees through a reimbursable agreement 

to perform audits of the use of SSBCI funds. OIG plans to audit both how the states are 

carrying out their oversight responsibilities and whether the institutions and businesses 

participating in the state programs funded by SSBCI are in compliance with loan-use

restrictions and requirements. OIG is expecting to continue to perform a significant number of

audits during FY 2017 as states increase their use of funds and request additional disbursements 

from Treasury for Round one, and if adopted, for Round two.

Outlays for SSBCI Round 1 and 2*

Actual Estimated

FY 

2011

FY 

2012 

FY 

2013 

FY 

2014 

FY 

2015 

FY 

2016

FY 

2017 

FY 

2018 

FY 

2019

FY 

2020

FY 

2021 Total

Round 1 

Outlays 366 187 364 229 221 80 - - 1,447

Round 2 

Outlays - - - - - - 212 571 235 312 130 1,460

Total 366 187 364 229 221 80 212 571 235 312 130 2,907

*Does not include outlays for Treasury administrative expenses.
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Section 2 – Budget Adjustments and Appropriations Language 

2.1 – Budget Adjustments Table

Dollars in Thousands

State Small Business Credit Initiative FTE Amount

FY 2016 Estimate 9 $6,703

 Changes to Base

 Maintaining Current Levels (MCLs) 0 $107

 Pay-Raise 0 $15

 Pay Annualization 0 $5

 Non-Pay 0 $87

 Subtotal Changes to Base 0 $107

Total FY 2017 Base 9 $6,810

 Program Changes

 Program Decreases 0 ($483)

 Travel and Contract Support 0 ($483)

 Subtotal Program Changes 0 ($483)

Total FY 2017 Request 9 $6,327

2A – Budget Increases and Decreases Description

Adjustments to Estimate..............................................................................+$617,000 / +0 FTE

The increase to the FY 2016 estimate is due to OIG audit responsibilities, SSBCI staffing through 

FY 2016 to ensure a proper wind-down, and the resources needed to pay for the development 

and production of the final program report.

Maintaining Current Levels (MCLs) .........................................................+$107,000 / +0 FTE

Pay-Raise +$15,000 / +0 FTE

Funds are required for the proposed January 2017 pay-raise.

Pay Annualization +$5,000 / +0 FTE

Funds are required for annualization of the January 2016 pay-raise.

Non-Pay +$87,000 / +0 FTE

Funds are required for non-labor costs such as travel, contracts, rent, and equipment.

Program Decreases .....................................................................................-$483,000 / -0 FTE

Travel and Contract Support -$483,000 / +0 FTE

Travel and contract support related to state technical assistance will decrease as the funding 

allocated to the states and municipalities becomes fully expended.
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2.2 – Operating Levels Table

Dollars in thousands

2B – Appropriations Language and Explanation of Changes

SSBCI does not receive a discretionary appropriation from Congress. Therefore, no

appropriations language is proposed.

2C – Legislative Proposals

Treasury recommends new legislation authorizing a $1.5 billion extension of SSBCI. Treasury 

will competitively award $1 billion to states best able to target local market needs, promote 

inclusion, attract private capital for start-up and scale-up businesses, strengthen regional 

entrepreneurial ecosystems, and evaluate results among other factors. An additional $500 million 

will be allocated to states according to a need-based formula.

Justification

SSBCI effectively supports state-sponsored public-private partnerships to increase lending and

investment to small businesses and manufacturers. SSBCI is already achieving results: the first

$864 million in program expenditures has already supported loans and investments of

$6.4 billion supporting over 12,400 private sector loans or investments to small businesses across 

the country—creating or saving more than 140,000 American jobs, as reported by the small 

businesses who received the loans and investments. The FY 2017 budget request proposes to 

improve the targeting of SSBCI funding through competitive awards. A second round of SSBCI

funding would also increase the impact of states’ newly developed relationships with lenders and 

investors from the program’s first round and would solidify a role for state economic

development agencies which are highly responsive to capital needs in local markets. Further, 

because an extended program would build on the successes of newly created programs or legacy

programs that were restarted with SSBCI funding, Treasury estimates that it would outlay funds

at a faster rate than under the first round of funding.

State Small Business Credit Initiative FY 2015 FY 2016 FY 2017

Object Classification Actual Estimated Estimated

11.1 - Full-time permanent 1,103 1,108 1,179

11.9 - Personnel Compensation (Total) 1,103 1,108 1,179

12.0 - Personnel benefits 360 394 355

Total Personnel and Compensation Benefits $1,463 $1,502 $1,534

21.0 - Travel and transportation of persons 45 125 63

23.1 - Rental payments to GSA 274 214 214

23.3 - Communications, Utilities, & Misc Charges 3 0 0

25.1 - Advisory and assistance services 2,367 1,250 853

25.2 - Other services from non-Federal sources 2 0 0

25.3 - Other purchases of goods & serv frm Govt accounts 2,193 3,582 3,633

26.0 - Supplies and materials 5 30 30

31.0 -Equipment 1 0 0

Total Non-Personnel $4,890 $5,201 $4,793

Total Budgetary Resources $6,353 $6,703 $6,327

Budget Activities:

SSBCI Program 0 0 0

SSBCI Administration 6,353 6,703 6,327

Total Budgetary Resources $6,353 $6,703 $6,327

FTE 9 9 9
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Section 3 – Budget and Performance Plan 

3A – State Small Business Credit Initiative Program

($0 from mandatory appropriations):

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

(the “Act”). Section 3003 of the Act authorized and directed the Secretary of the Treasury to 

establish a seven-year SSBCI, which was funded with $1.5 billion to support state programs that 

support lending to small businesses and small manufacturers. SSBCI supports new small business 

lending and investment through innovative state and local programs that help entrepreneurs

expand their businesses and create new jobs.

Under SSBCI, participating states 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. SSBCI allows states to build on 

successful models for state small business programs, including collateral support programs

(CAPs), loan guarantee programs, loan participation programs, and venture capital programs. 

Existing and new state programs are eligible for support under SSBCI.

By the end of FY 2015, states reported expending, obligating, or transferring over $1.24 billion 

in SSBCI funds. As of September 30, 2015, Treasury had disbursed over $1.36 billion, or

94 percent, of allocations to states. SSBCI estimates disbursing cumulative totals of

approximately $1.44 billion by the end of FY 2016, as states request disbursement of their

approved allocations under the program.

In FY 2017, Treasury will continue to monitor the performance of state programs and compliance 

with program rules. Treasury will collect the final annual report from states for the year ending

December 31, 2016, and will assess performance targets for the seven-year program. Additionally, 

Treasury will publish an interim evaluation of the SSBCI program.

Treasury proposes a new SSBCI authorization of $1.5 billion. In FY 2017, Treasury will process 

applications for need-based awards and will prepare and release the application for competitive 

awards.
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3.1.1 – State Small Business Credit Initiative Program Budget and Performance Plan

Dollars in Thousands

SSBCI Program Budget Activity

Resource Level FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017

Actual Actual Actual Actual Actual Actual Estimated Estimated

 Mandatory Resources $0 $1,258,900 $188,384 $13,198 $103 $0 $0 $0

Budget Activity Total $0 $1,258,900 $188,384 $13,198 $103 $0 $0 $0

Performance Measures FY 2013 FY 2014 FY 2015 FY 2015

Target

FY 2016 FY 2017

Actual Actual Actual Target Target

Cumulative Value of SSBCI Funds 

Transferred to States (thousands) $917,000 $1,146,000 $1,367,000 $ 1,367,000 $1,441,000 $0 

State Subsequent Disbursement Requests 

Approved or Denied within 90 days (%) 100 96 93 90 90 90

State Requests to Modify Allocation 

Agreements Approved or Denied within 90 

days (%)

90 95 90 90 90 90

Receive State Quarterly Reports within five 

business days of reporting deadline (%) 93 95 96 90 90 90

Key: DISC – Discontinued

As a source of funding for credit support and investment programs that increase access to capital 

for small businesses, SSBCI supports the following strategic objective of Strategic Goal #1, to 

promote domestic economic growth and stability while continuing reforms of the financial system:

• Objective 1.1: Promote savings and increased access to credit and affordable housing 

options.

SSBCI set three performance goals to measure the efficiency of program operations where 

Treasury can expressly influence the outcomes. The first goal is that Treasury approves or 

denies 90 percent of states’ requests for a subsequent disbursement of funds within 90 days of 

receipt of a formal submission. In FY 2015, SSBCI processed 93 percent of requests within 90 

days, excluding requests that were delayed due to ongoing or unresolved audits by OIG. 

Similarly, SSBCI aims to process 90 percent of all requests by states to modify the Allocation 

Agreement with Treasury within 90 days. In FY 2015, SSBCI processed 100 percent of

requests within 90 days. Finally, SSBCI aims to collect 90 percent of all quarterly reports 

within five days of the deadline to report. In FY 2015, SSBCI received 96 percent of quarterly 

reports from states within five business days of the reporting deadline.

Additionally, Treasury established performance indicators related to cumulative state program 

activity as of December 31, 2016, the date of the final annual report from participating states. 

These indicators are a response to a GAO audit. The first indicator is that Treasury disburses

98 percent of funds available to states by December 31, 2016. As of September 30, 2015, 

Treasury had disbursed 93 percent of available funds. The second indicator is that states 

achieve a cumulative private sector leverage ratio of 10:1 by December 31, 2016. As of 

December 31, 2014, states had achieved a cumulative leverage ratio of 7:36:1. The third 

indicator is that 98 percent of all Other Credit Support Programs (OCSPs) operated by states 

target borrowers or investees with fewer than 500 employees. As of December 31, 2014, 

100 percent of OCSPs met this target on an interim basis. The fourth indicator is that 
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98 percent of OCSPs make loans or investments with an average principal amount of $5 million 

or less by December 31, 2016. As of December 31, 2014, 97 percent of OSCPs met this target 

on an interim basis. 

Performance Indicators 2012 2013 2014 2015* 2016

(source: Annual Reports) Actual Actual Actual Actual Target

New financing leverage 6.58:1 6.95:1 7.36:1 N/A 10:1

Disbursement of funds available to states (% of total) 40 69 87 N/A 98

Percentage of OCSPs that target borrowers or investees 

with 500 or fewer employees 100 100 100 N/A 98

Percentage of OCSPs that make loans with an average 

principal amount of $5 million or less (source: Annual 

Reports)

93 93 97 N/A 98

Key: DISC – Discontinued

*As of the date of this request, CY 2015 Actuals are not available. The performance indicators are related to cumulative state 

program activity as of December 31, 2016, the date of the final annual report from participating states. 

3B – State Small Business Credit Initiative Administration

($6,327,000 from mandatory appropriations):

The authority to pay administrative expenses is provided by Section 3009 (b) of the Act, which 

appropriates $1.5 billion 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 

the Inspector General for program audits.

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

Dollars in Thousands

SSBCI Administration Budget Activity

Resource Level FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017

Actual Actual Actual Actual Actual Actual Estimated Estimated

 Mandatory Resources $0 $5,393 $4,746 $6,431 $7,731 $6,353 $6,703 $6,327

Budget Activity Total $0 $5,393 $4,746 $6,431 $7,731 $6,353 $6,703 $6,327
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Section 4 – Supplemental Information 

4A – Summary of Capital Investments

SSBCI uses Departmental Office’s (DO) systems and is part of DO’s capital investment strategy.

A summary of capital investment resources, including major information technology and noninformation technology investments, can be viewed and downloaded at:

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.