In its first year, Maryland State Small Business Credit Initiative Assists 27 Businesses, Creates or Retains more than 1,300 Full-time Jobs
Funding still available through three state agencies to support small businesses and entrepreneurs
New Carrollton, MD. [October 24, 2023] – Maryland Department of Housing and Community Development recently celebrated the first year of operations of the Maryland State Small Business Credit Initiative (SSBCI). Launched in August 2022, SSBCI created a partnership between three state agencies to administer up to $198 million in federal relief to small businesses and entrepreneurs impacted by the COVID-19 pandemic or operating in historically underserved communities.
SSBCI has committed more than $33.1 million to 27 applicants, including nearly $9.5 disbursed to 16 Socially and Economically Disadvantaged Individual (SEDI) businesses to date. The state’s SSBCI investment has leveraged nearly $192 million in additional private capital to create or retain more than 1,300 full-time equivalent jobs.
“I’m grateful to our federal partners for the important relief provided to Maryland through the State Small Business Credit Initiative. The cooperation and collaboration between the three state agencies charged with administering this program has led to a successful first year of operations, and applications are still open,” said Secretary Jake Day. “Our ongoing deployment of these resources and other small business assistance will help create an economy in Maryland that is competitive and equitable for all small business owners, provides job opportunities for working families, and leaves no community behind.”
Initially established by Congress in 2010 to provide loans and investments to underserved small businesses, SSBCI received a $10 billion allocation as part of the American Rescue Plan Act. Maryland’s SSBCI allocation is administered by three state agencies, the Maryland Department of Housing and Community Development (DHCD), the Maryland Department of Commerce, and the Maryland Technology Development Corporation (TEDCO). SSBCI funds were used to augment nine existing business assistance programs and create new partnerships to support businesses with limited opportunities for growth whether due to the pandemic or historic disinvestment. SSBCI funding is targeted to areas with a high concentration of small, micro, and SEDI businesses to further support ongoing state investments in underserved communities.
DHCD administers SSBCI funding through the Neighborhood BusinessWorks program. The program provides financing to new and expanding small businesses impacting and operating within Maryland’s designated Opportunity Zones, Priority Funding Areas, and Sustainable Communities. Approximately $20 million in SSBCI resources have been administered through Neighborhood BusinessWorks during the past year, including:
- A $5 million award to Clene Nanomedicine, Inc., a biopharmaceutical company with manufacturing operations in Elkton that is dedicated to improving the treatment of neurodegenerative diseases;
- The first partnership through the Loan to Lender initiative, a $15 million commitment to minority-led small business lender Lendistry, enabling the local Community Development Financial Institution to provide loans of up to $350,000 to eligible applicants.
The Maryland Department of Commerce administers SSBCI funding through two Maryland Small Business Development Financing Authority (MSBDFA) programs. Created in 1978, MSBDFA has been recognized as a national model for supporting small, minority-owned, women-owned, and veteran-owned businesses that are unable to obtain adequate business financing on reasonable terms. In particular, the program has become a well-established resource to support the growth of minority and women-owned businesses through a network of government agencies, local economic development organizations, banks, and private equity companies, as well as numerous business associations, chambers of commerce, and local professionals. In total, SSBCI funds have been used to approve four loans through MSBDFA totaling $2.9 million. The loans supported $6.4 million in total project costs, 65 new jobs, and 255 retained jobs.
“The MSBDFA program is one of Maryland’s most important tools for supporting small businesses and entrepreneurs in our historically underserved communities,” said Maryland Commerce Secretary Kevin Anderson. “The historic SSBCI funding has expanded the reach of this program to provide even more assistance to businesses in need and give more Marylanders an opportunity to increase their economic power.”
TEDCO allocated SSBCI funds into four existing programs targeting technology-based Maryland businesses and entrepreneurs. Three programs—the Venture Equity Fund, Venture Capital Limited Partnership Equity program, and Seeds Funds Equity program—are primarily focused on venture capital and startup funding. The fourth, the Social Impact Fund, provides investment and support to entrepreneurs who demonstrate economic or social disadvantage. Through these four programs, TEDCO continues to leverage its relationships with top-tier technology companies, entrepreneurs, and investors in the state while collaborating with universities, regional business accelerators and incubators, and other organizations.
“TEDCO is honored to be a part of this groundbreaking initiative, working alongside DHCD and Commerce to distribute the opportunities SSBCI funding presents to SEDI businesses,” said Troy LeMaile-Stovall, TEDCO CEO. “It is through this program that we can continue to fund and support the growth of more technology-based startups throughout the state.”
For more information about the nine Maryland business assistance programs supported by SSBCI and how to apply, visit http://business.maryland.gov/ssbci