Through the State Small Business Credit Initiative (SSBCI), Pennsylvania has been awarded nearly $268 million in American Rescue Plan funding.
The funding will be used to spur small business growth and create job opportunities across the commonwealth.
“Supporting our small businesses and boosting Pennsylvania’s world-class business environment continues to be one of my top priorities, and I thank President Biden for sharing that commitment,” Gov. Thomas Wolf said. “This funding from the Biden Administration is a significant investment in Pennsylvania’s future that will be used to empower our small businesses and generate new jobs.”
Congress established the SSBCI in 2010 to provide loans and investments to underserved small businesses. The American Rescue Plan reauthorized and expanded the program. As part of this reauthorization, $10 billion is being allocated by SSBCI to states, including $267.8 million to Pennsylvania.
“This is an historic investment in entrepreneurship, small business growth, and innovation through the American Rescue Plan that will help reduce barriers to capital access for traditionally underserved communities,” US Secretary of the Treasury Janet Yellen said. “I’m excited to see how SSBCI funds will promote equitable economic growth across the country.”
The funds will be distributed by the Pennsylvania Department of Community and Economic Development (DCED) to eligible economic development partners. They will then administer the funding to qualifying businesses through equity investments and loans.
The state will offer both equity capital investments and venture capital investments, which have been allocated a combined total of $142 million. Direct equity investments will be made through longstanding partners Ben Franklin Technology Partners and Life Sciences Greenhouses, as well as venture capital investments in new funds under the management of underserved venture capital firms.
It will also offer a loan participation program, which has been allocated more than $125 million. It will extend loans of no more than 50 percent of total financing to small business borrowers through certified economic development organizations (CEDOs) and community development financial institutions (CDFIs).
“I’m very pleased to see these ARPA funds allocated to Pennsylvania,” DCED Acting Secretary Neil Weaver said. “Our partners will use this funding to help small businesses, socially and economically disadvantaged businesses, and businesses in the innovation and technology sector.”