WASHINGTON – U.S. Senators Chris Coons (D-Del.) and Jeanne Shaheen (D-N.H.) introduced legislation this week to ensure that American small businesses have access to low-cost, fixed-rate, long-term loans. The 504 Loan Availability Act will prevent the Small Business Administration (SBA) CDC/504 loan program from becoming temporarily unavailable near the end of each fiscal year, and help guarantee that small businesses can invest in themselves and grow. The bill provides flexibility by combining the authorization of regular 504 loans and 504 refinancing loans under a single authorization cap. Combining these authorizations—without increasing the overall authorization level—will help prevent either program from hitting its cap partway through the fiscal year and becoming temporarily unavailable until the new fiscal year begins.

“Small businesses form the backbone of American manufacturing, and when they have reliable access to capital to grow their operations, they strengthen our economy, create good-paying jobs, and expand production right here in America,” said Senator Coons. “I’m proud to partner with Senator Shaheen to ensure that there are no further interruptions to the 504 program so that business owners nationwide can be confident in this reliable source of affordable financing.”

“The 504 loan program is one of the premier tools available for small businesses to access capital to invest and expand operations,” said Senator Shaheen. “I’ve long fought for increased flexibility for this program, including allowing borrowers to refinance existing 504 loans, and this simple fix will ensure these critical programs remain available to small businesses for years to come, under all market conditions.”

“Senator Coons has been a forward thinking leader on a myriad of small business issues over the years and we’re grateful for his continued leadership to ensure small businesses recovering from the pandemic have access to the capital they need through the Small Business Administration’s 504 loan program. Since 2020, the 504 program has assisted a record number of small businesses, and through the economic development tenets of the program, supported recovery and job creation in local economies. The 504 Loan Availability Act creates certainty for the availability of this integral economic development program now and for the future,” said Rhonda Pointon NADCO’s President & CEO. 

“The 504 Loan Availability Act is a critical piece of legislation which will allow the 504 Program to be even more impactful for the economy as we emerge from the pandemic.”,” said Jim Conroy, President of Pursuit CDC. “Moreover, it is especially critical now as it will help the program help more small businesses by offering better financing terms in a rising rate environment and as recessionary concerns tighten bank lending.”

“The 504 Loan Availability Act will have a significant impact in New Hampshire and across the country by providing better access to capital for growing small businesses.  We applaud Senators Shaheen and Coons for their diligent work supporting small businesses,” said Scott Gardiner, President & CEO of Granite State Development Corporation

The SBA 504 Certified Development Company Loan program provides SBA-backed loans for applicants that might not qualify for conventional financing and conserves working capital by requiring only a 10 percent borrower contribution.  Certified Development Companies (CDCs) are SBA-authorized nonprofit corporations that work with third-party lenders to promote economic development within their communities through 504 loans. 504 loans feature 10, 20 or 25 year terms and below-market fixed interest rates. Loan amounts are generally capped at $5 million, though certain eligible energy-efficient or manufacturing projects may qualify for up to $5.5 million each.

 

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