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Mayor Villaraigosa Announces New Citywide Small Business Loan ProgramValley Economic Development Center received $15 million to provide loans to small businesses to create new jobs for low to moderate-income personsMayor Antonio Villaraigosa along with Councilmembers Richard Alarcón and Greig Smith today announced a new $15 million Citywide Valley Economic Development Center (VEDC) Small Business Loan Program that will create new permanent jobs for low to moderate-income Angelenos. “Over 70 percent of Angelenos work for a small business and that’s why we’re launching an ambitious small business loan program today, to assist those who need a helping hand in these tough economic times,” Mayor Villaraigosa said. “With a laser-focus on our small businesses, and the funding we need to make a real impact, Los Angeles will set in motion job creation at the most grassroots level.” The Los Angeles Citywide Small Business Loan Program will focus on providing capital to existing businesses to help offset the current economic downturn. In light of the severe national credit crunch, many small businesses in the City of Los Angeles are shut out of access to credit and capital markets. This citywide funding program meets businesses’ demand for credit when private banks and other lenders have not been able to supply their needed credit. The Citywide Small Business Loan Program will require the borrowing businesses to create new permanent jobs and retain the existing level of employment. New jobs will be made available to the unemployed and low to moderate-income persons and must pay wages and salaries that at a minimum meet the Living Wage Ordinance of the City of Los Angeles. Loan amounts will range from $50,000 to $400,000, with a projected average amount of $250,000. Qualifying businesses can use loan proceeds for refinancing debt; purchasing inventory, equipment, or commercial real estate property; working capital; or tenant improvements. The Los Angeles Community Development Department (LACDD) is using Section 108 funds from the U.S. Department of Housing and Urban Development (HUD) to create the $15 million loan pool. “Small and micro businesses are the backbone of our economy, but during these tough economic times they are finding it harder and harder to survive,” said Councilmember Alarcón. “The Section 108 Loan Program is a creative way to leverage Federal Community Development Block Grant funds to help give businesses the low-interest loans they need to grow their businesses, continue to provide jobs and thrive in our communities.” “As a Councilman and former business man, I am proud to have brought forth the motion to have VEDC administer this program,” said Councilman Greig Smith, who represents the area in which Powerline Control Systems is located. “Having worked directly with Mr. Lester & PCS to assist in their company’s expansion, I understand the benefit this loan program will have throughout the City with the proven track record of VEDC setting the course.” Powerline Control Systems, Inc., the first business to receive a Los Angeles Citywide Small Business Loan, will use the loan to produce and market its new, patented GreenWorx energy-efficient commercial lighting control system. The loan will create 107 jobs over the next 36 months. “We are grateful to Mayor Villaraigosa, LACDD, VEDC and everyone responsible for the Small Business Loan Program,” said Marshall Lester, CEO of Powerline Control Systems. “We will be turning our loan into more business for us, more business for our customers and vendors, and more jobs in Los Angeles. By increasing the efficiency of electricity used for commercial and industrial lighting, GreenWorx will save millions of kilowatt-hours in the LADWP area by the end of 2010.” VEDC was selected to administer this program due to its experience in assisting small businesses; the organization currently oversees the San Fernando Valley Entrepreneur/ Micro-Enterprise Program and the Historic Downtown Retail Project. In identifying eligible loan recipients and administering funds, VEDC will work with LACDD’s Los Angeles Business Assistance Program (LABAP), whose five agencies provide technical assistance to micro and small business owners to improve operations and profitability. Source: Latin Business Association (LBA) Discuss it on SBE Forum >> |
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