Congresswoman Richardson announced that many area small businesses may be eligible for interest-free loans under a new program created by the American Recovery and Reinvestment Act.Â The "America's Recovery Capital" (ARC) program, which went into effect on June 15, 2009, allows small firms to take out loans of $35,000 to pay down existing business debts.Â Borrowers pay no interest on the ARC loans and repayment does not begin for one year.Â The loan program was established through the economic stimulus, which the President signed into law in February.Â
"Our small businesses are the backbone of our local economy and it is imperative that we support them during this difficult period," Congresswoman Richardson said.Â "One of the best ways we can help small businesses is to provide access to capital, which is why this new loan program is so important."
"I recently read an article that interviewed an owner of a bath-installation firm who has had to layoff staff to keep his company from going under," Congresswoman Richardson added.Â "This program will help small businesses like his by providing them with extra breathing room so they can pay operating expenses, make payroll, retain employees, and continue their work as job creators in our economic recovery."
To qualify for the ARC loans, small firms must demonstrate that they are experiencing immediate financial hardship due to the economic downturn, but are otherwise deemed by the Small Business Administration (SBA) to be viable. The loans will be made by commercial lenders and can be used for payments of principal and interest for existing, qualifying small business debts like credit card obligations, mortgages, lines of credit, and balances due to suppliers, vendors, and utilities.
"Small businesses are our nation's most reliable job creators, creating seven out of ten new jobs," Congresswoman Richardson noted. "To get our economy back on track, I will work with our local Chambers and municipal small businesses to make sure that they are able to grow and continue investing in our communities."