NC may add $75 million to business bridge loan program
Posted April 21, 2020 1:57 p.m. EDT
Updated April 22, 2020 8:49 a.m. EDT
Raleigh, N.C. — State lawmakers hope to pump $75 million into a short-term loan program for small businesses.
The new figure was rolled out Tuesday during a House of Representatives working group meeting, and it won unanimous support. The final number, and other details, may change before final passage, but a bipartisan group of both House and Senate leaders put out a joint statement after the vote, promising "a substantial allocation."
Gov. Roy Cooper offered support for the program as well Tuesday afternoon.
The low-interest loans are essentially bridge funding, with no payments for six months. Golden LEAF, a Rocky Mount-based economic development foundation, rolled out a $15 million version of the program last month, and demand quickly outstripped the funds.
The program has some 3,000 pending applications left, lawmakers heard Tuesday.
House members had talked last week about adding $25 million to the program. By Tuesday, that had increased to $75 million.
“You look at the $15 million that’s already been spent ... I think this is going to be a very good project," House Speaker Tim Moore said during the working group meeting.
Lawmakers also removed the 50-employee cap from a bill draft working its way toward passage, saying instead the program would prioritize companies with 100 or fewer employees.
Loans are capped at $50,000, and the proposed maximum loan term increased from 54 months to 66 months in a draft of the bill.
The money would come from the state's general fund and be paid back to it, minus defaults and up to 5 percent for administrative costs. Lending institutions that handle logistics would keep interest payments, according to the bill.
Companies that end up getting federal funding from similar programs, duplicating their benefits, would have to pay the state money back when they get the federal money, the bill states.
This working group also heard a report on the state's broadband infrastructure. They also heard updates from the state's unemployment office.
The General Assembly is scheduled to go into session April 28 to pass COVID-19 related legislation.