Maryland will get $23 million in federal funding to spur small business lending and help companies in the state expand and create jobs, state economic development officials and the U.S. Department of the Treasury said Thursday.
The funding, available through an initiative of the newly enacted federal Small Business Jobs Act, is designed to leverage a total $230 million in financing for small businesses and expected to create or retain thousands of jobs, said Christian S. Johansson, secretary of the state Department of Business and Economic Development. Johansson announced the state's allocation from the State Small Business Credit Initiative during a conference call with reporters along with Gene Sperling, counselor to Treasury Secretary Tim Geithner.
Sperling said that Gov. Martin O'Malley helped pave the way for the state small business initiative by gaining the support of 28 governors who asked President Barack Obama to include funding for state loan guarantee programs in the federal legislation.
"Across the country there were excellent innovative partnerships encouraging commercial lending to small business that were in greater demand than ever before... but being cut back or constrained because of the state budget crisis," Sperling said. "It became very clear that if the federal government could provide additional seed money to programs that were up and going, this money could have a very strong leveraging effect and get out very quickly to small businesses."
Maryland will be able to apply for the federal funds for programs that have private lenders as partners and extend credit to small businesses.