Gov. Ned Lamont announced a new version of a popular small business lending program during his Feb. 5 state-of-the-state address.
The Small Business Express program was created in 2011 as small businesses experienced difficulties accessing credit following the end of the recession.
The Department of Economic and Community Development bonded more than $290 million for the program over the past decade.
However, Lamont said it's time for Connecticut to partner with—not compete against—banks to provide loans and capital to existing and new small businesses.
The program changes are outlined in HB 5007.
DECD would partner with Connecticut Innovations to leverage an existing loan guarantee program through a third party entity, similar to Massachusetts and Rhode Island programs.
These loans are capped at $750,000.
DECD would also partner with local and regional community banks to offer loans to higher risk businesses—spurring private investment, leveraging private-sector expertise, and sharing credit risk.
These loans are capped at $500,000.
The bill prioritizes capital for businesses owned by women, minorities, veterans, and the disabled, while also fully funding the existing Minority Business Initiative.
Express 2.0 is expected to cost the state an estimated $18 million in the first three years.
The bill awaits action in the Commerce Committee.