504 Certified Development Loans

 

To assist small business concerns by providing long-term, fixed-rate financing for fixed assets through the sale of debentures to private investors.

Active 59.041 Small Business Administration F - Guaranteed/Insured Loans Not applicable. Small Business Investment Act of 1958, Title V (15 U.S.C. 695 et seq.), Title V, Section 504, Public Law 85-699 Small Business is based the size standard on either number of employees or annual receipts based on the North American Industry Classification system (NAICS) Small Business is based the size standard on either number of employees or annual receipts based on the North American Industry Classification system (NAICS) To become a Certified Development Company (CDC), the applicant should submit SBA Form 1246, "Application for Certified Development Company" to their local District Office and include the following information: (1) Name, address, and contact information of applicant; (2) list of officers and directors who represent the fields of commercial lending, financial risk management, internal controls, workforce, community, and economic development, legal issues related to commercial lending, and corporate governance in accordance with 13 CFR ? 120.823; (3) SBA Form 1081 on all officers, directors, and staff; (4) resume on each officer and director; (5) the name, resume, and description of duties for each individual who provides the CDC with the professional staff capability; (6) if contracted out, a copy of the contract is required to be submitted to SBA for pre-approval; (7) an organization chart and operating plan; (8) a plan of CDC operations (marketing, evaluating, packaging, processing, closing and servicing functions); (9) financial statements (if a start-up, provide a pro-forma balance sheet with detailed projections and assumptions); (10) the CDC's charter and certified by-laws; (11) articles certified by the State; and (12) a resolution of the Board of Directors certified by a corporate officer in which a company resolves to become a CDC, naming the person who is authorized to execute all documents. Preapplication coordination is required. Please review it. 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards applies to this program. Loan applications must be made on SBA Form 1244 and requirements set forth thereon must be fully complied with by the Certified Development Company and the small business being assisted. CDC is notified in writing by the SBA Office. CDC notifies applicant. Not applicable. From 1 to 15 days. Within 10 working days after formal acceptance of application. Requests for reconsideration of a declined loan will be granted at any time within 6 months from the date of decline, providing that reasonable evidence is submitted to substantially overcome the stated reasons for decline. Renewals initiated by loan recipients. Not applicable. Loans are to assist small businesses in the acquisition of land and buildings; the construction, expansion, renovation or modernization of buildings; or the acquisition and/or installation of machinery and equipment. Loans may have either a 10, 20, or 25-year term. The 504 Debt Refinancing Program may be used to help eligible small business owners ease their financial burdens and further job creation. The 504 Debt Refinancing Program can help eligible borrowers refinance debt from adjustable rate loans with its long term fixed-rates, creating significant savings to borrowers. Not applicable. This program is excluded from coverage under 2 CFR 200, Subpart F - Audit Requirements. Not all CDCs must provide audited financials. CDCs under $30 million in portfolio size can provide reviewed financials as per 13 CFR 120.826 (c) and (d) below: (c) Annual Audited/Reviewed Financial Statements. Each CDC with a 504 loan portfolio balance of $30 million or more (as calculated by SBA) must have its financial statements audited annually by a certified public accountant that is independent and experienced in auditing financial institutions. The audit must be performed in accordance with generally accepted auditing standards as adopted by the Auditing Standards Board of the American Institute of Certified Public Accountants (AICPA). The auditor must be independent, as defined by the AICPA, of the CDC. Annually, the auditor must issue an opinion as to the fairness of the CDC's financial statements and their compliance with GAAP. For CDCs with a 504 portfolio balance of less than $30 million (as calculated by SBA), the CDC's annual financial statements submitted to SBA must be reviewed by an independent CPA in accordance with GAAP, except that the D/OCRM may require a CDC with a portfolio balance of less than $30 million to submit an audited financial statement in the event the D/OCRM determines, in his or her discretion, that such audit is necessary or appropriate when the CDC is in material noncompliance with Loan Program Requirements. (d) Auditor qualifications. The audit or review must be conducted by an independent certified public accountant who: (1) Is registered or licensed to practice as a public accountant, and is in good standing, under the laws of the state or other political subdivision of the United States in which the CDC's principal office is located; (2) Agrees in the engagement letter with the CDC to provide the SBA with access to and copies of any work papers, policies, and procedures relating to the services performed; (3)(i) Is in compliance with the AICPA Code of Professional Conduct; and (ii) Meets the independence requirements and interpretations of the Securities and Exchange Commission and its staff; (4) Has received a peer review or is enrolled in a peer review program that meets AICPA guidelines; and (5) Is otherwise acceptable to SBA. Statutory formula is not applicable to this assistance listing.

Matching requirements are not applicable to this assistance listing.

MOE requirements are not applicable to this assistance listing. Additional information available on SBA's website at www.sba.gov. Information available at www.sba.gov. Initial contact should be directed to the local District Offices (https://www.sba.gov/tools/local-assistance/districtoffices) listed in Appendix IV of the Catalog of Federal Domestic Assistance under Small Business Administration. Linda Reilly - Chief, 504 Loan Division
409 3rd St., SW
8th Floor
Washington, DC 20416 US
linda.reilly@sba.gov
Phone: 202-205-9949 http://www.sba.gov/ 73-1154-0-1-376 (Guaranteed/Insured Loans) FY 22$9,014,210,000.00; FY 23 est $15,000,000,000.00; FY 24 est $16,500,000,000.00; FY 21$7,473,072,000.00; FY 20$5,365,089,000.00; FY 19$4,804,000,000.00; FY 18$4,592,728,991.00; FY 17$271,000,000.00; FY 16$41,000,000.00; - Minimum - $50,000 each with Maximum - $5,000,000 each or for manufacturing $5,500,000 each but may apply more than once. Energy public policy projects $5,500,000 each but capped at $16,500,000 total. See SBA Rules and Regulation, CFR, Section 120.800 and 120.900; Certified Development Company Program - Program Guide. Fiscal Year 2019 Project involving land, building or equipment or a combination of all three. Project financing for land and building has an option of a term of either 20 or 25 years. Existing businesses, new businesses and start ups are eligible. Refinancing eligible fixed assets is also allowed. Project financing for equipment may be for 10, 20 or 25 years depending on the useful life of the equipment. A third party lender provides 50% of the project financing and has a first lien position on the project assets. The 504 participation can be up to 40% of the project, with SBA being in the second lien position on the project.