Montgomery County Announces “Small Business Plus!” Program.
The program offers $20 Million for Job Growth through Partnership with Local Community Banks.
Montgomery County today announced an early July launch of the “Small Business Plus!” program. Through a unique collaboration between Montgomery County and community banks headquartered in the County, “Small Business Plus!” was developed to promote job growth through small business lending and earn a competitive rate of return for the County on its investment. Ten million dollars in County funds will be invested in participating community banks which will commit an equal amount, with the result that $20 million will be lent to local small businesses to further promote the creation of new jobs.
“Small Business Plus!” will establish partnerships with community banks to provide County deposits for those banks to lend to local businesses to create new jobs that lower the County’s unemployment rate and improve the County’s economy.
“We have a number of strong community banks headquartered in Montgomery County and it makes good sense to partner with them to generate jobs and business that benefits County residents and at the same time broaden the County’s tax base,” said Montgomery County Finance Director Joseph Beach. “This is an opportunity for Montgomery County to do ‘well’ — and do ‘good’ at the same time.”
“Small business is big business in Montgomery County, said County Council President Roger Berliner. “This initiative literally puts our money where our mouth is — in the hands of local banks to help small businesses. We are using our county assets to help a linchpin of our local economy. I am pleased that this effort, years in the making, is now being launched.”
“I am very pleased that Montgomery County will be investing with our local community banks so that they will be able to make small business loans to help with job creation and economic development in our County,” said Councilmember Nancy Floreen.
Banks are eligible to participate if they meet the following criteria: they must be headquartered in Montgomery County; must have assets greater than $200 million and less than $5 billion; and meet certain safety and soundness standards established by the County.
Under the program, a participating bank must originate the loans within 12 calendar months of the commitment by the County to make a program related deposit in that bank. All of the funds deposited will be covered by FDIC (Federal Deposit Insurance Corporation) insurance. Montgomery County will produce an annual report documenting the loan activity and estimating the number of jobs created through the program. This program is similar to a very effective program that has been successful in the State of Massachusetts and another program for which legislation has been introduced in the District of Columbia. Earlier this year the Maryland General Assembly approved a “Lend Local Act” to boost small business lending.
Among the banks who have agreed to partner with the County are Capital Bank, Congressional Bank, EagleBank, Monument Bank, and OBA Bank.
“This program is the right thing to do,” stated Scot Browning, President of Capital Bank. “County money, derived from our local tax base, should remain in our community to support our community. By depositing taxpayer dollars in local banks to be lent back into the community is a win-win.”
“We are proud to participate in the Small Business Plus! Program,” stated Ronald D. Paul, Chairman & CEO of EagleBank. “It is a unique opportunity to partner with the Montgomery County government to enhance lending programs for small businesses located in the County. We have committed to lend into the community twice the amount of funds that we receive from the Small Business Plus! Program,” Mr. Paul added. “This support allows these local businesses to grow, create new employment opportunities and thereby improve the County economy.”
“The county and the community banks have developed a deposit program that will benefit both taxpayers and the local economy,” said Jeffrey A. Lipson, President & Chief Operating Officer of Congressional Bank. “Congressional Bank is pleased to participate in this initiative, and looks forward to additional partnership opportunities that support Montgomery County small businesses.”
“This program shows a lot of promise for leveraging county assets into local job creation. I applaud the Executive for moving forward on this,” said Councilmember Hans Riemer.