The City of Lakewood provides federal Community Development Block Grant (CDBG) funding to eligible small businesses unable to secure loans through traditional lending sources due to undercapitalization or other lending restrictions. The Economic Development Business Loan Program provides loans to eligible small businesses currently located in Lakewood or to entrepreneurs looking to relocate or develop businesses within the city limits for the purpose of creating jobs for low-income people.
Technical assistance grants are provided to all supported small businesses to aid with all aspects of starting and running a business including marketing, management, finance, and strategic planning. Trained counselors are also available to help clients with their business plans, cash flow projections and loan applications.
For additional information about the CDBG Economic Development Business Loan Program, please contact Jeff Gumm in the Community Development Department at (253) 983-7773 or e-mail email@example.com .
Eligible Use of Loan Funds
Qualifying businesses can use the funds for:
- Start-up costs
- Land or property acquisition
- Real property and equipment improvements
- Working capital
- Inventory purchases
- Construction costs
- On-site infrastructure improvements
- Other loan assistance/loan guarantees
Terms and Interest Rates
The maximum loan to any one borrower is $35,000. Economic Development Business Loans carry a fixed interest rate with a maximum term of six years. Interest rates are generally between 4 and 8 percent, dependent upon risk.
- Eligible small businesses must be “microenterprises,” which are companies with five or fewer employees (one of which may be the owner). The business must be located in, or relocating to, Lakewood.
- The business must create or retain at least one full-time equivalent job for every $35,000 borrowed.
- At least 51 percent of the jobs created or retained as a result of the loan program must be held by or made available low- to moderate-income people (one of which may be the owner).
- For the purpose of this program, low-income people are defined as those at 80 percent or less of area median income, as determined by the federal Department of Housing and Urban Development.
- Jobs created or retained are calculated on a full-time basis (2,080 hours per year)
- Use of program funds for the payment of construction, rehabilitation or installation will require the payment of the higher of either state or federal prevailing wages.
Additional Funding Options
Community Capital Development
Community Capital Development (CCD) is a community-based lender that provides small businesses throughout Washington with access to capital as well as business assistance, with special emphasis on low-income, women, and minority entrepreneurs, and small businesses in distressed and underserved communities. CCD provides technical and financial assistance for businesses at every stage, from start-up to business expansion. Funding for small business loans are provided through the Seattle Economic Development Fund.
U.S.Small Business Administration
The U.S. Small Business Administration offers programs that specifically support the needs of small business, such as loan assistance, equity financing, surety bonding, and financing to assist with acquisition, operation or expansion.
EB-5 Investment Program
The federal EB-5 program , allocates 10,000 green cards each year for foreign nationals who invest in businesses that hire at least ten full-time U.S. workers. To qualify under the regular EB-5 investment category, an investment of at least $1 million is required (or at least $500,000 if investing in a rural or high unemployment area).