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A Matter of Scale: Florida Governor Outlines "Small" Business Stimulus Package

January 14, 2009
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Facing a $2.3 billion deficit in FY 2010, Florida Gov. Charlie Crist has proposed a new financing program to promote small business growth through the current financial crisis. Calling it an Economic Stimulus Plan, the governors.'s proposal will target small Florida-based companies with high-growth potential through direct loans and other support services. By focusing on small businesses, the state can target companies with good prospects for growth with a modest investment of taxpayer dollars, according to the press release accompanying the announcement. The price tag? Only $10 million.

An $8.5 million pilot program would provide loans of up to $250,000 per business to cover the cost of capital purchases, employee training and salaries for new jobs. Only Florida-based small businesses with between 10 and 99 employees would be eligible for the loans. Thirty-four of Florida's 67,400* active companies in that size range would receive loans if the modest loan maximum were reached for each project.

The loans would carry a two percent interest rate over a period of five years. Gov. Crist believes that the program will help address the lack of capital available to small businesses as bank rein in their willingness to extend credit.

The remaining $1.5 million will be used to provide technical assistance to smaller firms.

The governor's plan is an outgrowth of work done last year by the Florida Office of Tourism, Trade and Economic Development' s Project Green Jeans. That initiative worked with regional economic development organizations to craft a unifying "economic gardening" strategy for the state, alongside the governor's small business taskforce. Despite the governor's announcement, other state-funded programs to help companies are being cut. Last week, legislators agreed to reduce funding for the state's Quick Action Closing Fund by $24 million, according to the Miami Herald. Many other programs, including a variety of business incentives, also face cuts as the state attempts to address the looming deficit.

For more information on the governor's plan, visit: http://www.flgov.com/otted_econstimplan.

Note: * Active firms in 2005 (latest year available) from Census Bureau's Business Dynamics Statistics

Floridasmall business, state budget