California Helps Small Businesses
California Helps Small Businesses
SACRAMENTO, CA (3/15/2000). California's Loan Guarantee Program issued a new high of 764 loan guarantees last year, making possible a record $104.4 million in small business bank loans that would not have been made otherwise, the California Trade and Commerce Agency reports. "Small businesses are well-positioned to take advantage of the emerging opportunities California has to offer," says Trade and Commerce Agency Secretary, Lon Hatamiya. "This program has proven to be an effective tool in assisting companies move forward in their expansion plans."
One remarkable example is Dennis Berard of San Francisco. He had 20 years experience as a metal craftsman when he lost his job in 1995. Using $20 from his unemployment check, he bought a set of hand files and set up shop on a wood plank in a friend's back yard. Within 30 days, he had enough money to move into his own shop and start Alameda Metal Finishing and Deburring.
In 1998, when he needed a bank loan of $35,000 to buy OSHA-compliant equipment in order to grow, he couldn't get credit because of his insufficient credit history. With a loan guarantee issued by Nor-Cal Financial Development Corporation, however, he received his loan. Today, Berard employs 10 people, with some individuals hired through work furlough programs and Bay Area missions. Berard was awarded a California Entrepreneurial Spirit Award last year for his persistence and vision. The award was presented by Nor-Cal on behalf of the Governor and the California Trade and Commerce Agency.
Another example in Fresno: Dick Kelton, Richard Smith, and John Thayer started All-Star Warehouse & Distribution in 1986. Realizing the need to open another warehouse to better serve clients, the company obtained a $200,000 term loan last year, guaranteed at 90% by the Valley Small Business Development Corp. The additional funds assisted in the addition of a new warehouse, 20 new employees, and gross revenues of $6.5 million.
The California Loan Guarantee Program enables a small business to obtain a term loan or line of credit when it cannot otherwise qualify for a loan. Under the umbrella of the Trade and Commerce Agency, the Office of Small Business administers the program with the primary objective of creating and retaining jobs, as well as providing a service to all small businesses and entrepreneurs.
State-backed loan guarantees are available from $10,000 to $250,000 at competitive interest rates. For further information, contact the Trade and Commerce Agency's Office of Small Business (916/322-5790) for a listing of the eight Financial Development Corporations that issue state guarantees.
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