WASHINGTON (Reuters) – The U.S. Treasury Department said on Monday it had approved nine state plans for the State Small Business Credit Initiative worth $940 million, bringing total approvals under from the $1.5 billion COVID-19 Recovery Venture Capital Program.
The $10 billion SSBCI program aims to address a shortage of capital for starting new businesses and growing other small businesses, especially in disadvantaged communities, by attracting $10 of private investment for every $1 of taxpayer funding. It was reauthorized and expanded as part of last year’s $1.9 trillion American Rescue Plan Act.
State plan approvals announced Monday include a variety of venture capital funds, loan participation programs, loan guarantees, collateral support programs and portfolio insurance to make capital more accessible to small businesses. businesses and entrepreneurs.
Connecticut has received up to $119.4 million to launch two new venture capital funds supporting entrepreneurs from “underserved and diverse backgrounds” and a climate tech fund for clean energy, environmentally friendly manufacturing environment and climate resilience.
“We will invest equity, hopefully alongside other investors as well,” in “young, entrepreneurial, scrappy companies,” Connecticut Governor Ned Lamont said at a press briefing. “I think you’re going to see that $120 million grow to $1 billion in investments over a period of time and represent tens of thousands of jobs.”
Pennsylvania was approved up to $267.8 million, Alabama up to $111 million, South Carolina up to $101.3 million, Indiana up to $99.1 million $, Maine up to $62.2 million, New Hampshire up to $61.5 million, South Dakota up to $60 million and Vermont up to $57.9 million of dollars.
Funds are released in installments, with each subsequent disbursement dependent on the achievement of performance targets from previous funds.
A treasury official said there is now a ‘strong pipeline’ of additional state plans that are close to approval, and the treasury hopes to have completed the review of all states’ requests for here the end of summer.
(Reporting by David Lawder; editing by Jonathan Oatis)
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