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Kathleen Cabble
Ron Reuss, president of GulfCoast Business Finance in St. Petersburg
It's business as usual for now at one of the larger Small Business Administration lenders in the Tampa Bay area, but that could change with a prolonged government shutdown.
The SBA put a hold on processing most loan requests, effective Oct. 1, furloughing about 62 percent of its 3,500 workers, Bloomberg Businessweek reported.
"We continue to process loan applications to the Sacramento processing center, but they won't be reviewed. They'll be put in a queue, and once the employees return they'll look at them," said Ron Reuss, president of GulfCoast Business Finance Inc.
The typical two-day turnaround will start to lengthen as long as the staff is unavailable, Reuss said.
GulfCoast is a St. Petersburg nonprofit organization that is designated as a Certified Development Company by the SBA to administer the 504 loan program, a financing tool that helps small businesses with long-term, fixed-rate financing primarily to buy real estate and equipment. CDCs partner with lenders to make loans, with the lender's piece secured by a first lien covering half the project, and the CDC's piece secured by a second lien for up to 40 percent of the project cost and backed by a 100-percent SBA-guaranteed debenture, or bond.
"The bonds go on sale monthly," Reuss said. "Those projects scheduled for funding Oct. 16 will go through. The processing and closing documents and the pricing of the debentures and the identification of the investors already has taken place."
But many of the SBA employees who would be involved in getting the next round of bonds ready for sale in November likely are on furlough, so "there could be a delay in that regard," Reuss said.
Margie Manning is Quality and Content Editor of the Tampa Bay Business Journal. She also covers banking, finance and professional services.
