Plans for $65 million in State Small Business Credit Initiative funding have been approved to support small business and entrepreneurship in Tribal governments.
WASHINGTON – Today, the U.S. Department of the Treasury announced the approval of plans for up to $65 million in funding allocated to 18 Tribal governments under the American Rescue Plan’s State Small Business Credit Initiative (SSBCI). This funding is part of the largest and most expansive one-time investment for Tribal governments for small business financing in the history of the nation.
“Today’s announcement reinforces President Biden’s commitment to invest in small businesses and entrepreneurs,” said U.S. Deputy Secretary of the Treasury Wally Adeyemo. “Providing help to entrepreneurs like accounting services and legal advice is critical to unlocking their potential for growth and to continuing the nation’s historic small business boom.”
Reauthorized and expanded by President Biden’s American Rescue Plan, SSBCI includes nearly $10 billion to support small businesses and entrepreneurship in communities across the United States by providing capital and technical assistance to promote small business stability, growth, and success. It provides funds to states, the District of Columbia, territories, and Tribal governments for those jurisdictions to create tailored programs that offer funding to small businesses and entrepreneurs through equity/venture capital, loan participation, loan guarantee, collateral support, and capital access programs.
The following descriptions highlight five of the plans that Treasury has approved for these Tribal nations:
- The Mesa Grande Band of Diegueño Mission Indians is the lead applicant of a consortium comprised of six Tribal governments. This consortium, approved for up to $5,307,619, will operate one equity funds program. This program will support qualified financing needs for pre-seed, seed, and early-stage small businesses owned by the consortium Tribes and their Tribal citizens. The equity funds program is expected to target access to investment capital in a variety of sectors, including technology and renewable energy. The consortium expects the program will extend equity financing to Tribal- and citizen-owned businesses as an alternative to debt financing and expand financial and business capabilities for these businesses by introducing them to investor networks. Participating Tribes include Mesa Grande Band of Diegueno Mission Indians of the Mesa Grande Reservation, CA; Apache Tribe of Oklahoma; Confederated Salish and Kootenai Tribes of the Flathead Reservation; Klawock Cooperative Association; Pauma Band of Luiseno Mission Indians of the Pauma and Yuima Reservation; and Shinnecock Indian Nation.
- The Oneida Nation, approved for up to $3,839,291, will operate one loan participation program. The Oneida Nation will contract with Bay Bank, a Native CDFI, to help administer its program and serve as a source of companion loans for the program. The program will target small businesses owned by the Tribal nation or Tribal members with a focus on the construction, transportation, and service industries with the Tribe expecting the program to encourage small business ownership by Tribal members and create additional job opportunities for Tribal members.
- The Red Lake Band of Chippewa Indians of Minnesota, approved for up to $3,347,495, will operate two programs administered by Red Lake, Inc, a wholly-owned, Tribally-chartered company: one loan guarantee program and one equity funds program. The guarantee program will provide credit support for Tribal-owned and member-owned construction companies to obtain the surety bonds needed to compete for large construction projects, including Federal construction contracts. The equity funds program will provide affordable access to capital to support qualified financing needs by providing pre-seed, seed, and early-stage Tribal-owned, Tribal member-owned, and underserved small businesses. The equity fund program is expected to target access to investment capital towards technology-enabled start-up businesses. Red Lake, Inc. estimates that, collectively, its programs will expand member access to bonding and equity finance, provide financial education to business owners, create jobs for the Tribe and surrounding community, and introduce participating businesses to investor networks.
- Saint Paul Island, approved for up to $740,107, will operate one Equity/Venture Capital Direct program. The program will make a single direct equity investment in a new wholly Tribally-owned small business, pairing SSBCI funds with Tribal funds that have been obtained from the Tribe’s other commercial businesses. The Tribe expects this business, which will provide services to federal government agencies, to provide jobs and economic opportunities for Tribal members both on and off the remote Saint Paul Island and generate revenue for Saint Paul Island that will help fund future Tribal government services, projects, and programs.
Today’s announcement brings the total SSBCI Capital Program commitment to Tribal governments to $330 million, representing support for 93 Tribes. To date, 58 submitted Tribal government applications have been approved and Treasury will continue to review pending applications submitted by Tribal governments. See the full list of approved programs here.