World Trade Center records folder, 2001

NYC-WTC_000136448 City of New York Immediate Initiatives Recovery Loan Program Objective: To enable financial institutions to make bridge loans to affected businesses awaiting SBA Disaster loan financing. The Program will rely on loan guarantees to provide backstop credit support for bank loans to businesses and not-for-profits that may not be eligible for SBA take-out. We request also that not-for-profits be granted eligibility for SBA Economic Injury loans. Initial funding for the Program will be provided by the City and State of New York, with Federal reimbursement of these amounts. Program Description: The Recovery Loan Program will establish a loan guarantee fund to enable participating institutions to provide bridge loans to businesses affected by the WTC attack. It is expected that banks will be able to approve bridge loans within 2 days of application. Term loans and lines of credit, ranging up to $100,000, may be used for working capital, real estate, machinery and equipment, inventory and supplies. Most of these borrowers will eventually qualify for SBA Physical Disaster and Economic Injury loans. The immediate establishment of this Program will, however, allow banks to make bridge loans while loan applications are being reviewed by the SBA. The interest rate charged on these loans during the bridge period will match that offered by the SBA. Eligibility: New York City- and State-based commercial, industrial, retail enterprises and nonprofit corporations affected by the WTC disaster, and applying for Physical Disaster and Economic Injury loans from the SBA. Cost: The Program has been established for New York City businesses, with an initial guarantee fund of $50 million (to be increased to $__), funded equally by the City and the State of New York and to be reimbursed subsequently by the Federal government. With a 20% loan guarantee fund anticipated, banks will be able to lend an initial amount of up to $250 million to affected businesses. The money will be recycled as the SBA “takes out” loans initiated under this Program, thereby increasing the total amount of credit available to affected companies. A similar guarantee structure will be created for businesses located in New York State, outside of the City, with a guarantee fund of $ to be funded initially by the State, with subsequent Federal reimbursement. NYC 9/11 Public Portal Document