SBA 504 DEBT REFINANCE PROGRAM

[Pages:32]SBA 504 DEBT REFINANCE PROGRAM

Thursday, June 16 ? 3:30 p.m.

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SBA's West Virginia District Office

SBA 504 DEBT REFINANCE PROGRAM

Acknowledgement

We would like to thank Rebecca MacBlane and Nathan Nyland for their time and providing information regarding his

experience in lending and working on SBA loans from their perspective.

All opinions, conclusions, and/or recommendations expressed herein are

those of the presenter and do not necessarily reflect the views of the SBA.

PRESENTED BY:

REBECCA MACBLANE, EXECUTIVE DIRECTOR NATHAN NYLAND, DEPUTY DIRECTOR

SBA 504 Debt Refinance Program

The SBA 504 Debt Refinance Program was originally enacted as part of the Small Business Jobs Act of 2010. Although it was a short-lived program (expired in Sept. 2012), it was used to assist over 2,700 businesses refinance nearly $7 billion in old, expensive debt and unleash capital to reinvest into their businesses to create and retain jobs.

In December of 2015, Section 521 of Division E of the Consolidated Appropriations Act reauthorized it as a permanent part of the 504 Loan Program. The SBA will being accepting applications on June 24, 2016.

SBA 504 Debt Refinance Program

SBA has received statutory authority to reauthorize the 504 Debt Refinance Program for up to $7.5 billion. This is in addition to the existing $7.5 billion authorization for the regular 504 Program, providing a total of $15 billion authorized for 504 lending for FY 2016.

Additional details can be found in SBA Policy Notices #5000-1382 and 1383.

How Has the Program Changed?

Statutory Changes to Program

Three statutory modifications include:

1. This program will only be available in years when the 504 Program is at zero-subsidy.

2. A CDC's ability to use this program will be limited to 50% of the total dollars it loaned under the 504 Program (including 504 Debt Refi loans) during the previous fiscal year. Waivers to this rule may be possible (guidance will be provided in SOP 50 10 6).

3. The alternative job goal in the Jobs Act has been eliminated. Each 504 Refi loan must meet the standard 504 job creation and retention guidelines.

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