$96M to help Iowa start-ups, small businesses

DES MOINES — Up to $96 million in business capital, including loans, will be made available to Iowa start-ups and small and veteran-owned businesses under a state plan approved this week by the federal treasury department.

The funding is being made available through the federal State Small Business Credit Initiative, a program that was created in 2010 and renewed and expanded in the latest federal pandemic relief package, the American Rescue Plan.

“This is an historic investment in entrepreneurship, small business growth, and innovation through the American Rescue Plan that will help reduce barriers to capital access for traditionally underserved communities,” U.S. Treasury Secretary Janet L. Yellen said in a statement. “I’m excited to see how these SSBCI funds will promote equitable economic growth across the country.”

Iowa’s plan was submitted by the state’s economic development department. According to the department, the plan calls for:

“Small businesses and entrepreneurs dream big, drive Iowa’s economy and make our communities better places to live,” Gov. Kim Reynolds said in a statement. Reynolds at the time of its passage opposed the federal pandemic relief package.

“Iowa had the fastest economic recovery through the pandemic in large part because of the creativity and resilience of our small businesses,” Reynolds said in her statement. “This funding will build on the momentum by investing in our small businesses and entrepreneurs just as they have chosen to invest in Iowa.”

The White House said the programs are designed to help Iowa retain high-potential startup businesses that might otherwise relocate to areas with greater access to capital, and could have an impact on rural manufacturers.

“Iowa’s small businesses have faced some of the biggest economic challenges of the last few years, but they also have some of the greatest success stories and we've seen a record-breaking surge in new businesses for two years in a row,” Debi Durham, executive director of the Iowa Economic Development Agency and the Iowa Finance Authority, said in a statement. “Our team looks forward to working with our small business and innovation partners to bring these new efforts to life.”

The state said a process for applying for the business capital and loans still is underway and more information would be provided at iowaeda.com/ssbci.

In 2021, Americans applied to start 5.4 million new businesses, which was 20 percent more than any other year on record; and small businesses with fewer than 50 workers created 2.8 million jobs, the highest number recorded in a single year, according to the White House.

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