Beginning Oct. 1, a new City of Valdosta program using federal Community Development Block Grant (CDBG) funds will make available low-interest loans of up to $10,000 each to qualifying new and existing small businesses within the City of Valdosta. The Small Business Seed Loan Program (SBSLP) is an economic development activity of the city’s Neighborhood Development Division, which will utilize a portion of the CDBG funds the city receives to offer financial and technical assistance to local low- to moderate income entrepreneurs.
Realizing that small businesses are the backbone of our economy, the SBSLP program will offer two different loan products—the Start Up/Expansion Loan and the Working Capital Loan—to financially assist small business owners who may be unable to access traditional lending resources. A total of $50,000 in loans of various amounts (no single loan greater than $10,000) will be awarded annually through this program. Among other requirements for consideration, a small business must be located in the City of Valdosta and be licensed by the city to conduct business.
Clients receiving financial assistance through the SBSLP will also be required to accept technical assistance through a partnership with the Valdosta State University Small Business Development Center, who will help the applicant complete a business plan, create cash flow projections for the business plan, conduct marketing research, and learn from best business practices.
“The SBSLP program will also support the Valdosta Small Emerging Business (VSEB) program and, in collaboration with the VSU SBDC, will work with potential loan applicants to ensure their businesses are in the best possible position to benefit from the assistance of this loan program,” said City Manager Larry Hanson. “We are pleased our city government has created a program to support our small businesses by providing seed loans and technical assistance. By providing opportunities to assist businesses with start-up costs, the community and our citizens will benefit from the creation of new jobs and from the role small businesses play in creating a unique sense of place that enhances our economy and quality of life.”
Some eligible uses of the loan proceeds include the purchase of equipment, supplies, real estate, capital improvements, easements, startup operating costs, advertising, etc. On the other hand, loan proceeds may not be used to finance existing debt, political activities or restaurant start up enterprises (existing restaurants must be in operation for at least one year prior to submitting an application for expansion, working capital or technical assistance).
Among several criteria, all of which is listed on the application, both loan types carry the requirement of creating or retaining at least one position that will benefit low-to moderate-income persons and each has a percentage of owner’s equity required.
Applications must be completed and received by the last business day of the month to be considered for the following month’s review process, which may take 30 to 60 days from the initial submission to the final approval or disapproval of the loan. Loans will be received and evaluated on a first come-first served basis and once the total loan pool of $50,000 is reached, no additional loans will be available for the remainder of that particular fiscal year.
For more information about the loan program or to pick up a loan application, call the Neighborhood Development Division at 229-671-3617.