WASHINGTON – The Obama Administration announced eight additional Promise Zones across the country, including six cities, one rural area, and one tribal community. Promise Zones are high poverty communities where the federal government partners with local leaders to increase economic activity, improve educational opportunities, leverage private investment, reduce violent crime, enhance public health and address other priorities identified by the community. Through the Promise Zone designation, these communities will work directly with federal, state and local agencies to give local leaders proven tools to improve the quality of life in some of the country’s most vulnerable areas.
U.S. Department of Housing and Urban Development (HUD) Secretary Julián Castro and U.S. Department of Agriculture (USDA) Secretary Tom Vilsack announced new Promise Zone designations in the following communities:
- Camden, New Jersey
- Hartford, Connecticut
- Indianapolis, Indiana
- Minneapolis, Minnesota
- Sacramento, California
- St. Louis/St. Louis County, Missouri
- Pine Ridge Indian Reservation of the Oglala Sioux Tribe, South Dakota
- South Carolina Low Country
“From my time as Mayor to my tenure as Secretary, I’ve seen first-hand how a Promise Zone designation can spark progress and possibilities in underserved neighborhoods,” said HUD Secretary Castro. “A zip code should never limit the hopes that folks have for themselves or for their children. We’re proud to be working with a wide-variety of local leaders to strengthen neighborhoods and to unlock doors of opportunity that have been closed for far too long.”
“The Promise Zone effort is proof positive that partnerships are the key to community economic development,” said Agriculture Secretary Vilsack. “Families and children in rural and tribal communities are full of potential to compete and succeed in the 21st Century. When we invest our resources and establish long-lasting public-private alliances to strengthen educational opportunities, deliver health care, build infrastructure and create jobs, we are investing in our country’s future.”
To celebrate the newly designated zones, events were held across the country in each of the new urban zones. Secretary Julián Castro, U.S. Department of Housing and Urban Development visited St. Louis, Secretary Arne Duncan, U.S. Department of Education visited Minneapolis, CEO, Wendy Spencer, Corporation for National and Community Service visited Indianapolis, Deputy Secretary, Nani Coloretti, U.S. Department of Housing and Urban Development, visited Hartford and HUD Regional Administrators held events in Camden, NJ and Sacramento, CA. To highlight the rural zone designations of South Carolina's Low Country and South Dakota's Pine Ridge Indian Reservation, Secretary Tom Vilsack hosted media calls for South Carolina and South Dakota.
Background on Promise Zones:
Today’s newly designated Promise Zones join five others that President Obama designated in January, 2014 – San Antonio; Los Angeles; Philadelphia; Southeastern Kentucky Highlands and the Choctaw Nation of Oklahoma. The work underway in these communities is already showing results. For example:
- In San Antonio, the George Gervin Youth Center was awarded a $1.1 million YouthBuild grant from the Department of Labor to establish an education and training program for at-risk young people. The program is enrolling 64 people and preparing them for jobs in good, middle-class careers including jobs in the nursing and the building trades. The Gervin Center also received a $2 million Training-to-Work grant from the Department of Labor to help young men and women participating in work-release programs gain the job skills necessary to launch them on a path to high-demand jobs.
- In Los Angeles, the Unified School District is supporting college and career readiness programs for 6,500 students in 16 schools, while Advocates for Youth is developing a teen pregnancy prevention plan with community partners. Access to healthy foods is also a high priority in the L.A. Promise Zone. Business leaders and the East Hollywood Farmers Market are involved in various initiatives including establishing six community-supported agricultural sites to expand access to nutritious food options. The City is also conducting outreach to low-income tenants to reduce lead hazards in homes and will be placing AmeriCorps volunteers in schools and job training sites to counsel students on post-secondary education options and career choices.
- In Philadelphia, the Juvenile Justice Center is providing career training for youth who have been involved with the justice system. Promise Zone partners are creating access to healthy food and improving the business infrastructure for sustainable food production. Drexel University is leading a collaborative effort to increase the number of neighborhood children who have access to high quality child care and improve school performance. Security cameras were installed at a high-crime hot spot and businesses are being encouraged to take advantage of subsidized cameras along key Promise Zone commercial corridors. Specific plans are being developed to preserve affordable housing to avoid displacement of long-time residents as the neighborhood improves.
- In Barbourville, Kentucky, the Knox County Hospital is utilizing funding from the USDA’s Community Facilities Program to expand medical care services for a rural population of approximately 31,883 people and to secure more than 200 jobs.
- In the Choctaw Nation, nineteen Head Start classrooms in thirteen centers received direct support from the Department of Health and Human Services to provide early education, nutrition, and health services to 310 children and their families.
Today’s Promise Zone communities were selected from 123 applications from 36 states, Puerto Rico and Washington, DC. Each urban, rural, and tribal Promise Zone applicant was asked to put together a clear description of how the Promise Zone designation would accelerate and strengthen the community’s own efforts at comprehensive community revitalization. Each Promise Zone will be coordinated by a lead community based organization in partnership with the Obama Administration. HUD will be the federal lead for the six urban designees, while USDA will serve as the lead federal partner to the tribal and rural Promise Zones.
All Promise Zones will receive priority access to federal investments that further their strategic plans, federal staff on the ground to help them implement their goals, and five full-time AmeriCorps VISTA members to recruit and manage volunteers and strengthen the capacity of the Promise Zone initiatives.
Third Round Promise Zone Competition
A competition to select a third round of Promise Zones will commence later this year. In the Summer of 2015, HUD will publish a Notice in the Federal Register requesting public comment on the proposed selection process, criteria, and submissions for the final round of the Promise Zones initiative. This notice will provide urban, rural, and tribal communities the opportunity to help shape the third round application guide and efforts to support other communities more effectively in future years.
By: Ari Page
I never advocate that anyone borrow just to borrow. But if you need capital to make payroll or invest in something that you know will reap a short-term profit, then you need access to capital. In the past few years, even though money has been tight, there have always been options. Banks always need to lend to stay in business. You just need to know where to look.
Act I: Grandmother Isn’t Always Right
One of Steve Martin’s earliest routines went something like this. “I’ll never forget what my grandmother taught me. She said ‘Always…,’ no wait, ‘Never…,’ no it was, ‘Always…take a litter bag in your car. It doesn’t take up much room and when it gets full you can just toss it out the window.’”
That comes to mind when I hear people say things like, “Never…amass credit card debt.” If you can get better terms on a credit card than on a bank loan or a mortgage, than heck yeah you should amass credit card debt. If you borrow on a credit card at X% interest and make Y% with that money, where Y is greater than X, then let’s do that all day long!
And guess what. Ever since the current economic outlook improved and the market eased up, banks have been looking various ways to increase their earnings. Banks and federal associations are not quite as anal in their approach to risk, and want to find ways to generate some more business. The result is that some avenues of acquiring financing are now easier than ever.
One of the easiest, and, if done correctly, least expensive ways to get financing is via credit cards. I know this flies in the face of everything we’ve ever been told. Sure, many credit card companies still charge near-usurious interest rates, and most of us would be hard-pressed to make good use of capital at 20% and higher interest. But guess what. There are thousands of credit card offers at favorable rates for small businesses.
In fact, when the Office of the Comptroller of the Currency released their 19th annual “Survey of Credit Underwriting Practices” during the period ending June 30, 2013, they reported that among all loan products, credit cards had the greatest easing of underwriting standards.
Act II: Sometimes Things Too Good to Be True Are, in Fact, True
You’ve gotten another no interest credit card offer in the mail. “Sure,” you sardonically think. “Add in those hidden fees and crazy post-promotional-period interest rates and I’ll be giving them my house, car and boat in 12 months.”
But many of these offers are bonafide, great deals! And if you can benefit from access to financing, you should jump on these.
“But how does that even make sense for the bank?” you might say. Excellent question. The thing is, if banks don’t lend money, they don’t make money. Banks themselves can borrow at historic lows (they borrow at near zero percent from the Federal Reserve!), so they have access to lots of capital. Add this to the notion that banks have a lot of ways to make money, and you can start to see how this makes sense.
Banks want to have a relationship with you - and if they already have a relationship with you, they want to surround you with services that will keep you from going to the competition. So, providing you with great credit card offers costs them very little, and allows them to start shoving other promotions into your mailbox.
Moreover, although many zero percent interest terms appear to be capped, I am here to tell you unequivocally that if you know what you’re doing, that’s just not the case. Banks hope you’re not savvy enough to realize that if you know who to talk to and what to say, you can keep rolling over zero interest introductory offers for the foreseeable future. Business owners are the “crème de la crème” in the banking community and can take advantage of special promotional codes and techniques that aren’t available to the regular borrower.
Act III: Get Some
Here are some things you can do to take advantage of low- and zero-interest credit cards.
1. If you don’t have a business entity, get one. It’s easy to acquire and anyone can do it. You want to be smart about it, as some entities are far more lendable than others. For example, having Marketing/Advertising or Business Management in your business name, indicates you are (on average) a better risk than someone with Real Estate in their title. There are also important nuances in terms of what type of entity you set up.
2. Know how to elucidate what your business does. If you’re stuttering, stammering or seem unsure of your business, don’t expect the bank to lend to you.
3. If you have personal credit issues, get them cleaned up. There are many agencies, such as Kaydem Credit Help, that can assist you.
4. Search the web for credit card offers for businesses.
5. Do your homework to sort through various offers, identifying any hidden fees.
6. Explore existing relationships and see what they’re willing to do. I once went to my bank to open up a checking account and was offered a $17,000 credit card for being a loyal customer.
7. Consider requesting line increases or exploring promotional rates for those cards that you already have. Many banks won’t hesitate to reward good customers with increased credit lines.
Ari Page is CEO of Credit Card Builders, a company that helps small businesses raise unsecured, zero percent business financing. A voracious reader, Ari constantly scours the market for new techniques and strategies to identify creative and profitable borrowing strategies. Because of his unique insight and approach, Credit Card Builders has raised millions in funding for small businesses nationwide, with the average amount ranging from between $50,000 and $250,000.
On Wednesday, I’m hosting a free webinar with Ari about how you can get business funding.
Register For Free Webinar:
“How to Get $25,000 - $250,000
To Start or Grow Your Business”
Make sure to Register and reserve your spot on the webinar training before it fills up (space is limited).
Join me Wednesday 3/4, for a free webinar:
WASHINGTON – The head of the U.S. Small Business Administration (SBA) announced that for the second year, the SBA is launching an Accelerator Growth Fund competition for accelerators and other entrepreneurial ecosystem models to compete for monetary prizes of $50,000 each, totaling $4 million. The application period is from April 10-June 1 and information about the application process can be found at: www.sba.gov.
“We’re launching a second Accelerator Growth Fund competition to spur even greater opportunities for America’s small businesses,” said SBA Administrator Maria Contreras-Sweet. “Last year’s event was so successful, we’re looking forward to discovering and empowering the next trailblazers. Accelerators provide valuable resources to potential startups: a physical infrastructure to work in their infancy, mentoring, business-plan assistance, networking, opportunities to obtain venture capital, and introductions to potential customers, partners and suppliers—all critical elements to ensuring that small businesses flourish and succeed.”
Similar to last year’s competition, several panels containing expert judges from the private and public sector with collective experience in early stage investing, entrepreneurship, academia, start-ups and economic development will select the winners. The competition includes accelerators, incubators, co-working startup communities, shared tinker-spaces or other models. The panel will give particular attention to, applicants that fill geographic gaps in the accelerator and entrepreneurial ecosystem space.
Through this competition, the SBA is looking to support the development of accelerators and their support of startups in parts of the country where there are fewer conventional sources of access to capital (i.e., venture capital and other investors).
In addition, the SBA is also seeking accelerators headed by women and those that support them or other underrepresented groups. Thirty-two percent of last year’s accelerator winners were run by women and 14 percent were classified as underrepresented groups.
Manufacturing accelerator models will be given special consideration during this year’s competition, because they are critical to job growth and strengthening the nation’s economy.
Please click here for the Accelerator Growth Fact Sheet and specifics on how to apply and the timeline for 2015’s competition.
ORLANDO, Fla., April 1, 2015 – Agriculture Secretary Tom Vilsack announced that USDA has awarded $31.5 million in funding to local, state, and national organizations to support programs that help participants in the Supplemental Nutrition Assistance Program (SNAP) increase their purchase of fruits and vegetables. Recognizing that all Americans fall well short of the servings of fruits and vegetables recommended by the Dietary Guidelines for Americans, the grants will test incentive strategies to help SNAP participants better afford fruits and vegetables. These grants were made through the Food Insecurity Nutrition Incentive (FINI) program authorized by the 2014 Farm Bill.
The Secretary, who made the announcement at the Freshfields Farm market in Orlando, said, "Encouraging low income families to put more healthy food in their grocery baskets is part of USDA's ongoing commitment to improving the diet and health of all Americans." Vilsack continued, "These creative community partnerships also benefit regional food producers and local economies along with SNAP participants."
FINI is a joint effort between USDA's National Institute of Food and Agriculture (NIFA) and USDA's Food and Nutrition Service, which oversees SNAP and has responsibility for evaluating the effectiveness of the incentive projects. FINI brings together stakeholders from distinct parts of the food system and fosters understanding of how they might improve the nutrition and health status of SNAP households. The awards under FINI represent a variety of projects, including relatively small pilot projects, multi-year community-based projects, and larger-scale multi-year projects.
USDA is funding projects in 26 states for up to 4 years, using funds from FY2014 and FY2015. USDA will issue a separate request for applications in FY16, and in subsequent years. Fiscal year 2014 and 2015 awards are:
Pilot projects (up to $100,000, not to exceed 1 year):
- Yolo County Department of Employment and Social Services, Woodland, Calif., $100,000
- Heritage Ranch, Inc., Honaunau, Hawaii, $100,000
- Backyard Harvest, Inc., Moscow, Idaho, $10,695
- City of Aurora, Aurora, Ill., $30,000
- Forsyth Farmers' Market, Inc., Savannah, Ga., $50,000
- Blue Grass Community Foundation, Lexington, Ky., $47,250
- Lower Phalen Creek Project, Saint Paul, Minn., $45,230
- Vermont Farm-to-School, Inc., Newport, V.T., $93,750
- New Mexico Farmers Marketing Association, Santa Fe, N.M., $99,999
- Santa Fe Community Foundation, Santa Fe, N.M., $100,000
- Guilford County Department of Health and Human Services, Greensboro, N.C., $99,987
- Chester County Food Bank, Exton, Pa., $76,543
- Nurture Nature Center, Easton, Pa., $56,918
- Rodale Institute, Kutztown, Pa., $46,442
- Rhode Island Public Health Institute, Providence, R.I., $100,000
- San Antonio Food Bank, San Antonio, Texas, $100,000
Multi-year community-based projects (up to $500,000, not to exceed 4 years):
- Mandela Marketplace, Inc., Oakland, Calif., $422,500
- Market Umbrella, New Orleans, La., $378,326
- Maine Farmland Trust, Belfast, Maine, $249,816
- Farmers Market Fund, Portland, Ore., $499,172
- The Food Trust, Philadelphia, Pa., $500,000
- Utahns Against Hunger, Salt Lake City, Utah, $247,038
- Opportunity Council, Bellingham, Wash., $301,658
Multi-year large-scale projects ($500,000 or greater, not to exceed 4 years):
- Ecology Center, Berkeley, Calif., $3,704,287
- Wholesome Wave Foundation Charitable Ventures, Inc., Bridgeport, Conn., $3,775,700
- AARP Foundation, Washington, D.C., $3,306,224
- Florida Certified Organic Growers and Consumers, Gainesville, Fla., $1,937,179
- Massachusetts Department of Transitional Assistance, Boston, Mass., $3,401,384
- Fair Food Network, Ann Arbor, Mich., $5,171,779
- International Rescue Committee, Inc., New York, N.Y., $564,231
- Washington State Department of Health, Tumwater, Wash., $5,859,307
The announcement featured Marty Mesh, Executive Director of Florida Certified Organic Growers and Consumers (FOG). With FINI funding, FOG will expand its Fresh Access Bucks program, which allows SNAP participants to double their food dollars for fresh, Florida-grown fruits and vegetables at farmers markets around the state.
An evaluation of the funded projects will help policymakers determine how best to provide incentives to SNAP participants to increase healthy purchases. Priority was given to projects that develop innovative or improved benefit redemption systems that can be replicated, use direct-to-consumer marketing, show previous success implementing nutrition incentive programs that connect low-income consumers with agricultural producers, provide locally- or regionally-produced fruits and vegetables, and are located in underserved communities.
All FINI projects must (1) have the support of a state SNAP agency; (2) increase the purchase of fruits and vegetables by SNAP participants by providing incentives at the point of purchase; (3) operate through authorized SNAP retailers; (4) agree to participate in the comprehensive FINI program evaluation; (5) ensure that the same terms and conditions apply to purchases made by both SNAP participants and non-participants; and (6) include effective and efficient technologies for benefit redemption systems that may be replicated in other states and communities.
The FINI program is authorized and funded by the 2014 Farm Bill. The Farm Bill builds on historic economic gains in rural America over the past six years, while achieving meaningful reform and billions of dollars in savings for taxpayers. Since enactment, USDA has made significant progress to implement each provision of this critical legislation, including providing disaster relief to farmers and ranchers; strengthening risk management tools; expanding access to rural credit; funding critical research; establishing innovative public-private conservation partnerships; developing new markets for rural-made products; and investing in infrastructure, housing and community facilities to help improve quality of life in rural America. For more information, visit www.usda.gov/farmbill.
SNAP — the nation's first line of defense against hunger — helps put food on the table for millions of families experiencing hardship. The program has never been more critical to the fight against hunger. Over 60 percent of SNAP participants are children, elderly, or individuals with disabilities, and 42 percent of participants live in households in which at least one adult is working but still cannot afford to put sufficient food on the table. SNAP benefits provided help to millions who lost their jobs during the Great Recession. For many, SNAP benefits provide temporary assistance, with the average new applicant remaining on the program 12 months.
Through federal funding and leadership for research, education and extension programs, NIFA focuses on investing in science and solving critical issues impacting people's daily lives and the nation's future. More information can be found on the NIFA website.
GDF represents a client building a public farm market in Shelbyville, Indiana. News of this initiative will be forthcoming.
WASHINGTON– U.S. Department of Housing and Urban Development (HUD) Secretary Julián Castro announced new changes to strengthen a federal program called “Section 3” that directs jobs and training to low-income workers and connects businesses that hire them with HUD-funded contracting opportunities. The initiative would increase opportunities for businesses that hire local public housing residents for HUD-funded projects. In addition to changes to Section 3 requirements, Secretary Castro also announced the launch of a National Section 3 Business Registry. The registry is a searchable online database that local housing authorities, government agencies, and contractors can use to find firms that are self-certified as employing at least 30 percent public housing residents or low-income workers.
“All Americans should have the chance to contribute to the development and growth of their own communities,” said HUD Secretary Julián Castro. “These Section 3 initiatives will connect more hard-working folks and small businesses to local economic opportunities, giving them new tools to secure a more prosperous future.”
Every year, HUD funds create thousands of jobs across the country that range from construction to professional services like accounting or engineering. From 2009-2014, based on data reported by public housing authorities and HUD modeling, approximately 170,000 jobs were created by HUD for eligible low-income workers through this program.More than $5 billion in HUD-funded contracts has been directed to Section 3 businesses since 2009. While businesses are only required to hire 30 percent low-income workers, that goal has been exceeded nationally. About 50 percent of new hires for HUD-funded contracts are low-income workers or public housing residents.
Section 3 of the Housing and Urban Development Act of 1968 states that, “employment and other economic opportunities generated by Federal financial assistance for housing and community development programs shall, to the greatest extent feasible, be directed toward low- and very low-income persons, particularly those who are recipients of government assistance for housing, and to businesses that employ them.” Since 1994, the Section 3 program has been governed by an interim regulation. For the first time in 20 years, HUD is proposing a new rule today that would expand opportunities for public housing residents and low-income workers.
In 2012, HUD launched a five-city pilot Section 3 Business Registry in Detroit, Los Angeles, Miami, New Orleans and Washington, DC to help local public agencies better connect local businesses that hire low-income residents and workers with the contracting and economic development opportunities created by HUD-funded housing and development projects, something that is required under Section 3 guidelines. Nearly 1,000 businesses have signed up for the registry nationally. Today, in Miami, Secretary Castro applauded the nearly 300 Section 3 businesses that have signed up for the registry statewide. HUD announced that the initiative will now become national.
In addition, the proposed rule announced today would recognize new HUD programs established since 1994 that are required to meet low-income and public housing resident hiring goals. It also clarifies vague language in the interim rule and eases challenges to achieving compliance. HUD is currently accepting feedback on the proposed rule during a 60-day public comment period.
Washington, DC- Addressing the needs of women and the role they play in America’s economy, the U.S. Small Business Administration has launched a nationwide competition for entrepreneurs who are developing products and services that will enhance the lives of women and their families.
“The landscape of the U.S. economy has evolved drastically during the last 50 years, and women played a significant role in that change,” said SBA Administrator Maria Contreras-Sweet. “We are harnessing the power of America’s entrepreneurs to develop products, services and technologies that support women as they deal with the challenges of work and home. This innovation challenge will both help strengthen the economy and empower women to succeed.”
InnovateHER: 2015 Innovating for Women Business Challenge kicked off in early March with local competitions hosted by universities, accelerators, clusters, scale-up communities, SBA’s resource partners, and other local organizations. The SBA is seeking entrepreneurs who have created a product or service that will have a measurable impact on women and their families, fills a need in the marketplace, and has the potential for commercialization.
Those entrepreneurs selected by local judges will make it to the semi-final round. An executive committee comprised of SBA officials will review the semi-final nomination packages and select no more than 10 finalists. The finalists will compete for a total of $30,000 in prize money provided by Microsoft.
The 10 finalists will travel to the District of Columbia on May 8th where they’ll pitch their products and ideas to a panel of expert judges during SBA’s National Small Business Week.
For details on contest rules and a list of local competitions, visitwww.sba.gov/innovateHER.
WASHINGTON, Feb. 10, 2015 – Agriculture Secretary Tom Vilsack announced that rural agricultural producers and small business owners can now apply for resources to purchase and install renewable energy systems or make energy efficiency improvements. These efforts help farmers, ranchers and other small business owners save money on their energy bills, reduce America's dependence on foreign oil, support America's clean energy economy, and cut carbon pollution. These resources are made possible by the 2014 Farm Bill.
"Developing renewable energy presents an enormous economic opportunity for rural America," Vilsack said. "The funding we are making available will help farmers, ranchers, business owners, tribal organizations and other entities incorporate renewable energy and energy efficiency technology into their operations. Doing so can help a business reduce energy use and costs while improving its bottom line. While saving producers money and creating jobs, these investments reduce dependence on foreign oil and cut carbon pollution as well."
USDA is making more than $280 million available to eligible applicants through the Rural Energy for America Program (REAP). Application deadlines vary by project type and the type of assistance requested.
USDA is offering grants for up to 25 percent of total project costs and loan guarantees for up to 75 percent of total project costs for renewable energy systems and energy efficiency improvements. The REAP application window has been expanded. USDA will now accept and review loan and grant applications year-round.
Eligible renewable energy projects must incorporate commercially available technology. This includes renewable energy from wind, solar, ocean, small hydropower, hydrogen, geothermal and renewable biomass (including anaerobic digesters). The maximum grant amount is $500,000, and the maximum loan amount is $25 million per applicant.
Energy efficiency improvement projects eligible for REAP funding include lighting, heating, cooling, ventilation, fans, automated controls and insulation upgrades that reduce energy consumption. The maximum grant amount is $250,000, and the maximum loan amount is $25 million per applicant.
USDA is offering a second type of grant to support organizations that help farmers, ranchers and small businesses conduct energy audits and operate renewable energy projects. Eligible applicants include: units of state, tribal or local governments; colleges, universities and other institutions of higher learning; rural electric cooperatives and public power entities, and conservation and development districts. The maximum grant is $100,000.
The REAP program was created in the 2002 Farm Bill. Because of the success of the program, Congress reauthorized it in the 2014 Farm Bill with guaranteed funding of no less than $50 million in annual funding for the duration of the 5 year bill. The 2014 Farm Bill builds on historic economic gains in rural America over the past six years while achieving meaningful reform and billions of dollars in savings for taxpayers.
Since 2009, USDA has awarded $545 million for more than 8,800 REAP projects nationwide. This includes $361 million in REAP grants and loans for more than 2,900 renewable energy systems. When fully operational, these systems are expected to generate more than 6 billion kilowatt hours annually – enough to power more than 5.5 million homes for a year.
In 2013, owners of the Ideal Dairy restaurant in Richfield, Utah, used REAP funding to install 80 solar modules and two 10-kilowatt inverters, which convert energy from solar panels to electricity. The owners have saved, on average, $400 per month. These savings have helped them preserve their restaurant and livelihood.
President Obama's plan for rural America has brought about historic investment and resulted in stronger rural communities. Under the President's leadership, these investments in housing, community facilities, businesses and infrastructure have empowered rural America to continue leading the way – strengthening America's economy, small towns and rural communities. USDA's investments in rural communities support the rural way of life that stands as the backbone of our American values.
WASHINGTON–The U.S. Small Business Administration (SBA) announced today that the Impact Investment Fund of the Small Business Investment Company (SBIC) program has tripled in the last 12 months.
“Capital investment in some sectors, geographies and industries is still lower than you would expect and like. Through the Impact Investment Fund, we’ve sent a message to professional fund managers with expertise in areas like clean energy, education technology, and advanced manufacturing as well as those looking for 'off the beaten path' gems in low income or economic distressed communities across the country. SBICs as a whole, fill capital formation gaps at the low end of the middle market, the Impact Fund, puts a magnifying glass where the gaps are widest," said SBA Associate Administrator for Investment and Innovation Javier Saade.
The SBA began 2014 with two Impact SBICs managing $182 million and ended the year with six Impact SBICs collectively managing between $442 million and $572 million in total assets depending on the amount of credit guarantees approved and employed. Given the SBIC Impact Investment Fund is still well below the originally expected $1 billion leverage level, there is room to further grow the list of professional investors interested in pursuing impact strategies.
Three of the six Impact SBICs have not deployed capital. The other three have invested in 33 companies across the country and collectively employ approximately 4,600 people. These companies include an organic cage-free poultry operation in Texas, a wood waste-to-pellet fuel concern in Michigan and an educational institution in an urban low-income community in Puerto Rico.
One of the policy changes made was seemingly simple but equally meaningful – the Impact Investing Initiative became the Impact Investment Fund, making it a permanent feature of the SBIC Program. The Fund uses the rapidly evolving strategies that involve marrying financial gains and intentional social returns to narrow gaps.
Initially, SBIC’s were limited to SBA-identified impact investments, but now because of the flexibility of the Impact Investment Fund, participating funds can identify and pursue their own strategies. In addition to the expansion of this fund, SBA removed several key barriers that prevented access to it by:
- Lifting the $200 million restriction to offer licensed Impact SBICs better access to leverage;
- Removing the waiting period in accessing multiple leverage commitments; and
- Permitting existing SBICs to opt-in if they meet the Impact Fund requirements.
The reasons for the relatively slow deployment of impact investing strategies at the institutional level are varied and complex, but one of the main reasons, is the adoption of standards to measure intentional social impact has been spotty. The SBA and the federal government, supports the adoption of standards to further enable more institutional private capital flow to the small business community.
Information on the fund and the policy can be found here. The changes were made based on feedback from a significant number of private sector stakeholders and were consistent with themes the SBA heard from impact investors the White House roundtable on Impact Investing that was held this past summer. The comments align with the recommendations of the US National Advisory Board on Impact Investing released this summer and with the findings of the G8 Task Force on Social Impact Investing, Impact Investment: The Invisible Heart of Markets.
The six Impact SBICs are:
|2011||Michigan Growth Capital Partners SBIC, LP|
|2012||SJF Ventures III, LP|
|2014||Bridges Ventures U.S. Sustainable Growth Fund, LP|
|2014||Morgan Stanley Impact Fund|
|2014||Bluehenge Secured Debt SBIC, LP|
|2014*||Renovus Capital Partners, LP|
HUD-VASH vouchers in Indian Country will build on national effort to end Veteran homelessness
WASHINGTON – Today the U.S. Department of Housing and Urban Development (HUD) announced that the HUD and U.S. Department of Veterans Affairs (VA) program that helps homeless veterans find permanent supportive housing will, for the first time, expand directly into Native American communities. This support for veterans is provided through the HUD-Veterans Affairs Supportive Housing (HUD-VASH) Program which combines rental assistance from HUD with case management and clinical services provided by VA.
The HUD-VASH program will now be opened to tribes so they may directly serve Native American veterans living on or near tribal lands. To expand the HUD-VASH program, $4 million will be invested specifically to support Native American veterans experiencing homelessness by providing them with secure housing and connecting them with clinical services and case management. This groundbreaking new effort will expand opportunity for approximately 650 veterans who are currently homeless or at risk of homelessness.
“Ensuring that our men and women who served in uniform receive the care and support they’ve earned is a national responsibility,” said HUD SecretaryJulián Castro. “But for too long, fulfilling that responsibility to many Native American veterans has been borne by Indian Country alone. We’re changing that this year.”
Expanding the HUD-VASH program will inform and improve how HUD serves Native American veterans, as well as further the goals of ending homelessness in tribal communities more broadly. While there is a need for the program in Indian Country, HUD is calling on both national and regional Native American leaders, associations and communities to offer insight into the design of the expansion, including ways that tribes estimate homelessness, what criteria HUD should establish in allocating funding, what medical providers are offering care to veterans, and how HUD can target program assistance in ways that encourage the creation of new housing.
To expedite the program expansion, HUD has requested tribal responses through its Office of Native American Programs within 30 days rather than the traditional 60 day comment period.
In addition, six of HUD’s Regional Field Offices will host public listening sessions with Native American communities in their areas. Those who can attend sessions are encouraged to do so.
As HUD celebrates its 50th anniversary this year, Secretary Castro is focused on advancing policies that create opportunities for all Americans, including the broader Administration goal of ending homelessness among veterans. HUD-VASH is an important part of that effort to provide critical housing and services to veterans experiencing homelessness that also includes HUD’s Continuum of Care program, VA’s Supportive Services for Veteran Families (SSVF), and the Mayors Challenge to End Veteran Homelessness.
Since the release of Opening Doors, the nation’s first ever Federal strategicplan to prevent and end homelessness, all forms of homelessness have declined significantly, particularly among veterans.In November 2014, HUD, VA and the U.S. Interagency Council on Homelessness (USICH) released a national estimate of veteran homelessness in the United States which showed a decline of 33 percent (or 24,837 people) since 2010. This includes a nearly 40 percent drop in the number of unsheltered veterans sleeping on the street.
Since 2008, HUD and VA have awarded almost 70,000 HUD-VASH vouchers and served more than 82,000 veterans experiencing homelessness. Rental assistance and support services provided through HUD-VASH are a critical resource for local communities in ending homelessness among veterans.
In the traditional HUD-VASH program, VA Medical Centers (VAMCs) assess veterans experiencing homelessness before referring them to local housing agencies for these vouchers. Decisions are traditionally based on a variety of factors, most importantly the duration of homelessness and the need for longer term, more intensive support in obtaining and maintaining permanent housing. The HUD-VASH program includes both the rental assistance the voucher provides and the comprehensive case management that VAMC staff offers.
Veterans participating in the traditional HUD-VASH program rent privately owned housing and generally contribute no more than 30 percent of their income toward rent. VA offers eligible veterans experiencing homelessness with clinical and supportive services through its medical centers across the U.S., Guam and Puerto Rico.
MCLEAN, VA--- Freddie Mac announced today that it had another strong year with $28.3 billion in loan purchase and bond guarantee volume for its multifamily business in 2014, up 10 percent from $25.9 billion the previous year. This was the second largest year of multifamily purchases in the company's history.
New business volume reflects $25.8 billion of our $25.9 billion purchase cap for 2014 established by Freddie Mac's conservator, the Federal Housing Finance Agency (FHFA). In addition, new business volume not subject to the FHFA purchase cap totaled $2.5 billion and included certain affordable housing loans, loans for smaller multifamily properties, and loans for manufactured housing communities.
Quotes from David Brickman, executive vice president of Freddie Mac Multifamily:
- "We used 99.9 percent of our $25.9 billion volume cap for 2014 mortgage purchases by expanding our market presence and improving our market position as a leading multifamily debt capital provider in the U.S."
- "We are on a roll and growing by serving more markets including manufactured housing communities and smaller apartment communities. Our financing also increased for class B&C properties, as well as for those in secondary and tertiary markets due to rising demand for rental housing throughout the U.S."
- "We expect to have another year of double digit percent growth in our new business volume given that our volume cap for 2015 has been increased by 16 percent to $30 billion and we expect to increase our activity in uncapped products, particularly small property loans."
Freddie Mac Multifamily 2014 Business Highlights:
- Generated nearly $1.2 billion in total comprehensive income through the first three quarters.(Fourth quarter 2014 earnings data has not yet been released).
- Executed 21 Multifamily securities offerings in 2014 for a total transactions volume of $22.4 billion which, in addition to K-Deals, included a small volume of other securities, including the company's Q- and M-Deals.
- Issued $21.3 billion in K-Deals in 2014 and securitized almost $93 billion in multifamily loans since the program started in 2009, backing approximately $79 billion in guaranteed certificates and almost $14 billion in unguaranteed certificates.
- Settled roughly $2.7 billion in targeted affordable housing business of which approximately $1.4 billion were multifamily bond credit enhancements and Tax-Exempt Bond Securitizations (TEBS).
- Purchased just over $1.2 billion in seniors housing mortgages.
- Transacted close to $1.3 billion in student housing loans.
- Continued to provide a consistent source of liquidity to support affordable rental housing nationwide. Approximately 90 percent of the apartment units Freddie Mac finances are affordable to households earning up to the area median income, and most of those loans are securitized.
- Provided financing for nearly 1,800 properties amounting to almost 427,000 apartment units, of which the majority are affordable to families earning low or moderate incomes.
- Provided additional liquidity to more underserved markets by launching new initiatives to provide financing for Small Balance Loans and Manufactured Housing Community loans.
- Reported a low delinquency rate of 4 basis points as of December 31, 2014, reflecting our continued strong portfolio performance.
Click here to read the 2013 business volume press release.
Since the launch of Freddie Mac's multifamily business in 1993, it has provided more than $344 billion in financing for about 63,000 multifamily properties.
Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nation's residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Today Freddie Mac is making home possible for one in four home borrowers and is one of the largest sources of financing for multifamily housing.