|
Rep. Bob Hasegawa, serving the 11th District Serving parts of South Seattle including Beacon Hill, Georgetown, South Park, Allentown, Boulevard Park, part of North Highline Unincorporated Area, Burien, City of Sea-Tac, all of Tukwila and Southcenter, the southern and eastern parts of Renton, Fairwood, Benson Hill and adjacent unincorporated areas of King County. |
Hasegawa, McIntire Jumpstart Business-Loan Program for Veterans, Minorities and Women
May 7, 2009
OLYMPIA –A low-interest loan program that has helped hundreds of
minority, veteran, and women-owned businesses was revived Thursday, when
Gov. Chris Gregoire signed HB 1167.
The Linked Deposit Program has
provided access to more than $340 million in bank loans for hundreds of
small businesses. But the program became untenable for participating banks
because of historically low interest rates.
Rep. Bob Hasegawa, Vice
Chair of the House Finance Committee, and State Treasure James McIntire led
the effort to restart the program.
“It was a pleasure working with
my former mentor, State Treasurer Jim McIntire, to come up with a creative
solution to fix a glitch in the linked deposit program,” the Seattle
lawmaker said. “This way, in three months the linked deposit program will be
up and running again, providing low-interest loans to women and minority
owned businesses.”
The current statute requires banks to pay at
least 2 percent interest on the state’s certificates of deposits while also
requiring them to issue loans at lower-than market rates. The low-interest
rate environment has forced many banks to drop out of the program because
they were required to pay the state an above-market rate on the deposits.
The bill removes the 2 percent minimum-interest requirement and adds
flexibility for the treasurer so the linked deposit program overall can work
in the current market environment.
“The measure revitalizes the
Linked Deposit Program which was moribund in this low-interest-rate
environment,” McIntire said. “We are hoping this will re-energize lending
for some of the small businesses that need it most. Thanks to Rep.
Hasegawa’s leadership, we can continue to operate this valuable program.”
Background:
The Washington State Legislature found that minority and women owned
businesses had been historically denied access to capital and that lack of
capital is a key barrier to the development of minority and women owned
businesses. In response, the legislature passed the 1993 Minority and Women
Owned Business Assistance Act, which created the Linked Deposit Program.
The Act directs the Office of the State Treasurer, the Office of
Minority and Women's Business Enterprises, and the Department of Community,
Trade, and Economic Development to operate a program that links the deposit
of state funds to loans made by participating financial institutions to
qualified minority and women-owned businesses. The deposit of state funds is
made at below market rates. The savings are then passed on by the bank to
the Linked Deposit borrowers in the form of an interest rate reduction.
For More Information about Linked Deposit visit:
http://www.omwbe.wa.gov/financing/ldp/index.shtml
http://www.dva.wa.gov/Linked%20Deposit.html
Gov. Gregoire signs HB 1167 on May 7, 2009.
Front: Gov. Chris Gregoire, Rep. Bob Hasegawa. Back: Philip Brady, Senate Staff;
Marissa Chavez, LA to Rep. Hasegawa; Diane Smith, Senate Staff Coordinator and Counsel.