Louisiana Louisiana District Office District Office

AGENDAAGENDA

• SBA’s Mission and Purpose

• Programs of Assistance

Aid Counsel Assist Protect the interests of small

business concerns Support Champion small businesses

SBA's Mission and PurposeSBA's Mission and Purpose

We help people get into business, stay in business, grow and prosper.

Simply put………………Simply put………………

Programs Of AssistancePrograms Of Assistance

Financial Assistance Programs

Non-Financial Assistance

Non-Financial Assistance ProgramsNon-Financial Assistance Programs Government Contracting Assistance

($220B Market Place)

• Prime Contracts

• Subcontracting Assistance

• Certificate of Competency (COC)

• Size Determination Surety Bond Program Procurement Network (DSBS),

SUB-Net, and Tech-Net Small Business Innovation Research

Program (SBIR) Hubzone Empowerment

Contracting

Business Information Centers (BICs) Small Business Development Centers

(SBDCs) Service Corps of Retired Executives

(SCORE) Small Disadvantaged Business

Certification (SDB) Section 8(a) Business Development

Program Section 7(j) Management and

Technical Assistance BusinessLaw.gov SBA Small Business Classroom

Surety Bond ProgramSurety Bond Program

SBA guarantees bid, performance; payment and

ancillary bonds up to $2 million issued by surety companies for

construction, service and supply contracts, and reimburses the

sureties up to 90% of the losses sustained if the contractor

defaults.

Small Disadvantaged Business Small Disadvantaged Business (SDB)(SDB)

To qualify as SDB, a firm must be majority owned and

controlled by one or more individuals who are socially

and economically disadvantaged. SBA is the

Federal agency designated to certify eligible firms as SDB.

HubZone Empowerment HubZone Empowerment ContractingContracting

SBA encourages economic development through the

establishment of preferences for award of federal contracts to small

businesses located in designated HubZone areas. This fiscal year, the goal for Federal buying agencies is

3% of its procurement dollars.

Eligibility RequirementsEligibility Requirements

• Business located in HubZone

• 35% of employees reside in HubZone

• 51% Unconditionally owned by U.S. Citizens

Section 8(a) BusinessSection 8(a) BusinessDevelopment ProgramDevelopment ProgramA business development program whereby SBA has the power to obtain Federal Government contracts, and SBA, in turn, subcontracts these contracts to eligible Section 8(a) certified businesses.

Section 8(a) ProgramSection 8(a) Program

General Eligibility criteria:• small business• 51% owned, controlled and daily managed

by socially and economically disadvantaged individuals.

• In business for at least 2 years (or obtain waiver)

• Must demonstrate requisite management and technical capability

• Non-minority women may be eligible

Section 8(a) ProgramSection 8(a) Program

• SBA assists these firms in the growth and development of their businesses, and helps them in gaining equal access, improving their ability to compete on an equal basis in the mainstream of the American economy

• Currently 150 firms in Louisiana

• Participation in the program is for a maximum of 9 years.

ACCESS TO CAPITALACCESS TO CAPITAL

ATTENTION!!

SBA SBA DOES NOT DOES NOT offer offer grants to start or grants to start or

expand small expand small businesses, although businesses, although SBA does offer a wide SBA does offer a wide

variety of loan variety of loan programs for these programs for these

purposes.purposes.

A business concern that is A business concern that is independently owned and operated independently owned and operated and is not dominant in its’ field of and is not dominant in its’ field of operation, and together with its’ operation, and together with its’ affiliated or subsidiary companies affiliated or subsidiary companies (if any) it does not exceed a specific (if any) it does not exceed a specific size standardsize standard for its’ business for its’ business industry.industry.

Definition of a Small Business

EXAMPLESEXAMPLES Size Standards (innumber of

employees*NAICS Code Description or millions of dollars)

113210 Forest Nurseries and Gathering $ 5.0 Forest Products

236620 Commercial and Industrial $31.0 Bldg. Construction

237990 All Other Heavy Construction $31.0238210 Electrical Contractors $13.0238350 Carpentry Contractors $13.0332322 Sheet Metal Work Manufacturing 500332710 Machine Shops 500334111 Electronic Computer Manufacturing 1,000541410 Interior Design Services $ 6.5

541330 Engineering Services $ 4.5541320 Architectural Services $ 6.5541512 Computer Systems Design Services $23.0*North American Industry Classification Systemhttp://www.ntis.gov/yellowbk/1nty205.htm)

Financial Assistance ProgramsFinancial Assistance Programs 7(a) Loan Program

SBA Express Caplines

Export Working Capital Program (EWCP)

International Trade Loans

Small Business Investment Company (SBIC) Program

Angel Capital Electronic Network (Ace-Net)

Microloan Program Disaster Assistance

Program

504 Loans

7(a) Guaranty Loan Program7(a) Guaranty Loan Program

Generally, SBA may guarantee up to $3.75 million of a loan made to a small business by a bank or non-bank lender.

The guaranty rate is 85% on loans of $150,000 or less, and 75% on loans greater than $150,000.

The guarantee SBA provides encourages the lender to make more loans to small businesses.

Use Of Loan ProceedsUse Of Loan Proceeds

Start-up

Expansion

Working Capital

Inventory

Machinery/Equipment

Furniture/Fixtures

Purchase/Construct

building

Business buyout Leasehold

improvements Debt restructure

Terms and Interest RatesTerms and Interest Rates

Terms and Interest Rates are negotiated between borrower and lender; however, SBA places a cap on the interest rate a lender can charge.

Typically, longer terms are given to re-pay SBA guaranteed loans.

w/c – 7yrs; equip – up to 10yrs R.E. – 25 yrs.

FeesFees

SBA charges the lender a nominal fee for SBA to provide the guaranty.

Origination fee allowed – no Packaging fee allowed –yes

SBA SBA ExpressExpress Loan Program Loan Program

Faster, Easier, More Efficient

Maximum of $350,000 Interest Rates -- fixed or

variable, tied to prime. Maturity may go up to 7

years with possible extension. SBA provides a 50% guarantee

Lender uses own forms

PATRIOT EXPRESS PROGRAMPATRIOT EXPRESS PROGRAM

• Maximum Loan Amount of $500,000

• Loans below $150,000 are guaranteed at 85%

• Interest rates range from 2.25-4.75% over prime depending upon the size and maturity of the loan.

PATRIOT EXPRESS CONT.PATRIOT EXPRESS CONT.

• Eligible military community members include:

• Veterans• Service-disable Veterans• Active-duty service members• Reservists and National Guard members• Current spouse of any of the above• Widowed spouse of a service member of

veteran who died during service

SMALL LOAN ADVANTAGE SMALL LOAN ADVANTAGE

• To encourage larger lenders to make lower $ loans

• Maximum: $250,000• Guarantee: < $150k = 85%; > $150k = 75%

• Approval time: 5 – 10 days

• Paperwork: streamlined; 2 pg application for borrower

SMALL LOAN ADVANTAGESMALL LOAN ADVANTAGE

• Lender requirements: Preferred Lenders (PLP).

• SBA Form 2301 Parts A, B and C.

SBA 504 LOAN PROGRAMSBA 504 LOAN PROGRAM

• Fixed asset financing

• 50/40/10 split

• Certified Development Company (CDC) does packaging

• Bank in first lien position

• 10 yrs, equip.; 20 years, R.E.

• CDC funds come from bond sale

Microloan ProgramMicroloan Program

The MicroLoan Program provides small loans ranging from $100 to $50,000. Under this program, the SBA makes funds available to nonprofit intermediaries; these, in turn, make the loans. The average loan size is $10,000. Completed applications usually are processed by the intermediary in less than one week. If the borrower secures financing from another source, the loan limit is $105,000.

SBA Louisiana District OfficeSBA Louisiana District Office

Small Business: Backbone of the Louisiana Economy according to a report by the SBA’s Office of Advocacy, small businesses clearly play a crucial role in our state’s economy. Not only do small businesses play a vital role as job creators, but their diversity and composition provide the work force with endless opportunities.

What do these corporations What do these corporations have in common with hundreds of have in common with hundreds of

thousands of other businesses?thousands of other businesses?

They have all beenThey have all been helped helpedby theby the

U.S. Small Business U.S. Small Business Administration!Administration!

Louisiana District OfficeLouisiana District OfficeOne Canal PlaceOne Canal Place

365 Canal Street, Suite 2820365 Canal Street, Suite 2820New Orleans, LA 70130New Orleans, LA 70130

Telephone: (504) 589-6685Telephone: (504) 589-6685Fax: (504) 589-2339Fax: (504) 589-2339

Reginald G. Harley – 504.589.2035Reginald G. Harley – 504.589.2035Vallery Brumfield – 504.589.2705Vallery Brumfield – 504.589.2705

Call the SBA Answer Desk

1-800-U-ASK-SBA

(1-800-827-5722)

Louisiana District Office

(504) 589-6685

Please visit our Louisiana SBA Web Site - http://www.sba.gov/la

““Supporting the Formation, Supporting the Formation, Growth, Prosperity, and Viability Growth, Prosperity, and Viability of Louisiana’s small businesses.”of Louisiana’s small businesses.”

Louisiana District Office

Thank you!!