District government officials yesterday unveiled a $16 million package of new aids for small businesses.
Loans, job-trainig funds and technical assitance are included in a plan developed by the Mayor's Overall Economic Development Advisory Committee (MOEDAC) and the Office of Business and Economic Development. c
The effort is meant "to provide support for businesses, especially small and minority businesses, to develop and remain in the district," said Daniel J. Callahan III, president of Riggs National Bank and chairman of the committee.
The package will, for the first time, provide substantial city financial help for small business, Callahan added. Also included is a new plan to show businesses how to utilize the various city programs and work with District bureaucrats.
Two new loan programs are the heart of the financial aid plan.
A $750,000 revolving loan fund, financed by the federal Economic Development Administration, will make direct loans to D.C. business, explained Lawrence Schumake, director of the Office of Business and Economic Development.
The loans will be short term -- not more than five years -- so the money will be repaid quickly and can be loaned out again, he said.
For longer term loans, a group of seven District banks has committed $12 million for loans to be financed jointly with the federal Small Business Administration.
The city has already formed a Local Development Corporation that borrows money from the SBA and relends it to Washington firms that cannot qualify for conventional financing.
So far, Schumake said, the LDC has made four loans: $500,000 plant; $420,000 to American sales, a beer distributor to buy and a building; $224,000 to Unified Services, a janitorial firm, for expansion and $420,000 to Merchants Cash and Carry, a new food wholesaler.
All the programs are meant to help businesses that might otherwise move out of the District or firms interested in expanding into Washington, Callahan conceded that "there's no guarantee" that any of the firms would have gone elsewhere without city aid.
To provide job training funds, the District has set aside $100,000 in federal Comprehensive Education and Training Assistance (CETA) money that will be combined with other federal and city money to create a $600,000 payroll.
That money will be used for on-the-job training in local economic development projects, Schumake said.
Also announced yesterday were a series of nonmonetary aids to business, including a new Financial and Technical Assitance Handbook telling businesses what programs are available to help them.
A financial assistance seminar to teach business owners how to get aid was held yesterday at Howard University and an entrepreneurship institute is being planned to aid in business operations.