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United States Government Accountability Office:
GAO:
Report to Congressional Committees:
December 2011:
State Small Business Credit Initiative:
Opportunities Exist to Improve Program Oversight:
GAO-12-173:
GAO Highlights:
Highlights of GAO-12-173, a report to congressional committees.
Why GAO Did This Study:
Congress enacted the Small Business Jobs Act of 2010 in September 2010
in response to concerns that small businesses have been unable to
access capital that would allow them to create jobs. Among other
things, the act aims to stimulate job growth by establishing the $1.5
billion State Small Business Credit Initiative (SSBCI) within the
Department of the Treasury (Treasury) to strengthen state and
territory (state) programs that support lending to small businesses
and small manufacturers. Participating states are expected to leverage
the SSBCI funds to generate an amount of private financing and
investment at least 10 times the amount of their SSBCI funds (that is,
a leverage ratio of 10:1). The act also requires GAO to audit SSBCI
annually. Accordingly, this report examines (1) which states applied
for SSBCI funds and the planned uses of those funds; (2) Treasury’s
implementation of SSBCI; and (3) Treasury’s efforts to measure whether
SSBCI achieves its goals. GAO surveyed state SSBCI applicants (for a
100 percent response rate), analyzed data from Treasury case files,
and interviewed officials from Treasury and eight participating states.
What GAO Found:
Fifty-four of the 56 eligible states and territories submitted
applications requesting a total of about $1.4 billion in SSBCI funds.
According to GAO’s survey of SSBCI applicants, states plan to support
153 lending programs nationwide with SSBCI funds, 69 of which are new
programs being created because of the SSBCI program. These lending
programs include a variety of capital access programs and other credit
support programs, with venture capital programs receiving the largest
amount of funds among eligible program types. SSBCI applicants
anticipate that their SSBCI funds will allow them to leverage up to
$18.7 billion in new private financing and investment. Some
applicants, however, expressed concern that achieving a 10:1 leverage
ratio of private financing and investment to program funds could
ultimately prove challenging, especially for states creating new
programs.
Treasury’s procedures for SSBCI have evolved throughout its
implementation of the program. Treasury began approving applications
for SSBCI funds in January 2011 in accordance with guidance it issued
in December 2010. However, Treasury did not finalize its application
guidance and review procedures until April and May 2011, respectively.
Some states indicated they delayed submitting their applications until
Treasury’s guidance was finalized, with 37 states not submitting an
application until June 2011-—the deadline for applications. In
addition, Treasury did not finalize its procedures for disbursing
subsequent installments of funds to states until November 2011, citing
potential different legal interpretations of the act’s disbursement
requirements as the cause for the delay. Treasury is implementing a
plan to monitor states’ compliance with program requirements, which
will include sampling transaction-level data to evaluate the accuracy
of the states’ annual reports. The Treasury Inspector General made
recommendations in August 2011 to improve the tools Treasury will use
to monitor state compliance.
Treasury has not yet established performance measures for the SSBCI
program. Treasury officials noted they are considering several draft
performance measures to assess the efficiency of the program. However,
Treasury has not finalized its plans for measuring the SSBCI program’s
performance. GAO and others have recognized the importance of using
performance measures to gauge the progress of programs. GAO has also
identified key attributes of successful performance measures. Given
the preliminary nature of Treasury’s potential performance measures,
assessing whether the measures reflect the attributes of successful
performance measures is premature. Nonetheless, considering these
attributes as it works to finalize the SSBCI-specific performance
measures could help Treasury to develop robust measures. Until such
measures are developed and implemented, Treasury will not be able to
determine whether the program is achieving its goals.
What GAO Recommends:
GAO recommends that Treasury direct the SSBCI Program Manager to
consider key attributes of successful performance measures when
developing and finalizing SSBCI-specific performance measures.
Treasury concurred with the report’s recommendation.
View [hyperlink, http://www.gao.gov/products/GAO-12-173] or key
components. For more information, contact A. Nicole Clowers at (202)
512-8678 or clowersa@gao.gov.
[End of section]
Contents:
Letter:
Background:
Most States Are Participating in SSBCI and Plan to Use the Funds to
Support a Variety of Programs:
Treasury's Evolving Processes Have Created Some Delays:
Treasury Is in the Process of Developing Performance Measures for
SSBCI:
Conclusions:
Recommendation for Executive Action:
Agency Comments and Our Evaluation:
Appendix I: Objectives, Scope, and Methodology:
Appendix II: Copy of GAO Questionnaire:
Appendix III: SSBCI Funds Applied for, Approved, and Disbursed, by
Location, as of October 31, 2011:
Appendix IV: Planned Uses of SSBCI Funds, by Location:
Appendix V: Comments from the Department of the Treasury:
Appendix VI: GAO Contact and Staff Acknowledgments:
Tables:
Table 1: SSBCI Funds Applied for, Approved, and Disbursed, by
Location, as of October 31, 2011:
Table 2: Planned Uses of SSBCI Funds, by Location and Program Type
(number of programs in parentheses):
Figures:
Figure 1: Timeline of Major SSBCI Milestones:
Figure 2: Distribution of SSBCI Funds Applied for by States and
Territories:
Figure 3: Planned Number and Type of New and Existing Programs to
Receive SSBCI Funds Reported by States and Territories, from Aug. 15
to Sept. 14, 2011:
Figure 4: Planned Uses of SSBCI Funds by Eligible Program Type
Reported by States and Territories, from Aug. 15 to Sept. 14, 2011:
Abbreviations:
CAP: capital access program:
GPRA: Government Performance and Results Act of 1993:
OCSP: other credit support program:
OMB: Office of Management and Budget:
SSBCI: State Small Business Credit Initiative:
United States Government Accountability Office:
Washington, DC 20548:
December 7, 2011:
Congressional Committees:
Small businesses play a vital role in the U.S. economy, accounting for
about half of private sector output and employing more than half of
private sector workers.[Footnote 1] Because of their importance,
Congress has grown increasingly concerned that small businesses might
not be able to access enough capital to enable them to spur job
creation in the nation's ongoing economic recovery. In 2008 and early
2009, major disruptions of business credit markets made accessing
credit difficult for small businesses. For example, a Wells Fargo
survey showed that the number of small businesses having difficulty
accessing credit had more than tripled between 2007 and 2010, with
ultimately almost 40 percent of small businesses indicating that
credit was difficult to obtain.[Footnote 2] Although most financial
institutions reported in April 2010 that they were no longer
tightening their small business lending standards, the Federal Reserve
noted at the time that those lending standards "remained quite
stringent."[Footnote 3] The Secretary of the Department of the
Treasury (Treasury) testified in June 2011 that small businesses were
concentrated in sectors that had been especially hard-hit by the
recession, including construction-related industries. As a result,
during the depths of the crisis, the rate of job losses was almost
twice as high in small businesses as it was in larger firms.[Footnote
4]
The Small Business Jobs Act of 2010 created the State Small Business
Credit Initiative (SSBCI) within Treasury to strengthen state programs
that support lending to small businesses and small
manufacturers.[Footnote 5] Funded with $1.5 billion, SSBCI was
designed to help spur up to $15 billion in lending to small
businesses. Under the program, participating states, territories, and
the District of Columbia (states) are to use the federal funds for
programs that leverage private lending to help finance small
businesses and manufacturers that are creditworthy but have been
unable to secure the loans needed to expand and to create jobs.
[Footnote 6] SSBCI is designed to allow states to build on existing or
new models for state small business programs.
The act also requires that we annually audit SSBCI.[Footnote 7]
Accordingly, this report examines (1) which states are participating
in SSBCI and their planned uses of those funds, (2) Treasury's
implementation of the SSBCI program, and (3) Treasury's efforts to
measure whether the SSBCI program achieves its goals.
To determine which states applied for and received SSBCI funds and the
planned uses of the funds, we developed a Web-based questionnaire to
collect information from the 54 states and territories that filed a
Notice of Intent to Apply for SSBCI funds for which we achieved a 100
percent response rate.[Footnote 8] On the basis of our application of
recognized survey design practices and follow-up procedures, we
determined that the data collected via our survey were of sufficient
quality for our purposes. We also conducted interviews with Treasury
officials, as well as selected state officials and financial
institutions within those states, either via teleconference or site
visits to inform our understanding of states' planned uses of SSBCI
funds. We limited our selection of states to interview to those states
whose SSBCI applications had been reviewed and approved and for which
the applicant had signed an allocation agreement by June 30, 2011:
California, Hawaii, Indiana, Kansas, Maryland, Missouri, North
Carolina, and Vermont.
To evaluate Treasury's implementation of the SSBCI program, we
compared and contrasted Treasury's SSBCI procedures and planned
control activities with GAO's internal control standards, including
Internal Control in the Federal Government.[Footnote 9] We also
interviewed Treasury officials about the types of training it provided
its staff to help ensure compliance with its procedures. Additionally,
we utilized data obtained through our questionnaire to identify the
dates on which states submitted their SSBCI applications and whether
Treasury required resubmission and reviewed a nonprobability sample of
SSBCI applications consisting of all eight states that had signed an
SSBCI allocation agreement by June 30, 2011, to determine whether all
aspects of these states' applications were considered. We assessed
whether Treasury followed its procedures and appropriately documented
its decisions by analyzing the documentation of the application
reviews. Because we used a nongeneralizable sample to select the
applications to review, our findings cannot be used to make inferences
about SSBCI applications of states that signed allocation agreements
after June 30, 2011. However, we determined that the sample would be
useful in providing illustrative examples on procedures and
documentation practices applied by Treasury. Furthermore, we conducted
interviews with Treasury officials about the type of testing the
agency plans to perform of its controls to ensure compliance with
SSBCI procedures, lessons learned about the review process, how they
addressed problems, and their plans to follow up with states to ensure
that SSBCI funds are used for the intended purposes outlined in
approved applications for program funds.
To review Treasury's efforts to measure whether the SSBCI program
achieves its goals of increasing small business investment and
creating jobs, we discussed with Treasury their proposed performance
metrics for the SSBCI program. We also interviewed Treasury officials
as well as officials from the eight states that had signed a SSBCI
allocation agreement with Treasury by June 30, 2011, to collect
documentation that was used to inform our understanding of SSBCI
program performance and Treasury's metrics. A more detailed
description of the scope of our review and the methods we used is
contained in appendix I, and a copy of our questionnaire can be found
in appendix II.
We conducted this performance audit from February 2011 to December
2011 in accordance with generally accepted government auditing
standards. Those standards require that we plan and perform the audit
to obtain sufficient, appropriate evidence to provide a reasonable
basis for our findings and conclusions based on our audit objectives.
We believe that the evidence obtained provides a reasonable basis for
our findings and conclusions based on our audit objectives.
Background:
The Small Business Jobs Act of 2010 (the act) aims to address the
ongoing effects of the 2007-2009 financial crisis on small businesses
and stimulate job growth by establishing the SSBCI program, among
other things. SSBCI is designed to strengthen state programs that
support private financing to small businesses and small manufacturers
that, according to Treasury, are not getting the loans or investments
they need to expand and to create jobs. The act did not require a
specific number of jobs to be created or retained as a result of SSBCI
funds.
The act appropriated $1.5 billion to be used by Treasury to provide
direct support to states for use in programs designed to increase
access to credit for small businesses. Using a formula contained in
the act, Treasury calculated the amount of SSBCI funding for which
each of the 50 states, as well as the District of Columbia, the
Commonwealth of Puerto Rico, the Commonwealth of the Northern Mariana
Islands, Guam, American Samoa, and the United States Virgin Islands
were eligible to apply.[Footnote 10] This formula takes into account a
state's job losses in proportion to the aggregate job losses of all
states. (See appendix III for more information on available funding by
location). In addition to states, the act granted permission to
municipalities to apply directly for funding under SSBCI in the event
that a state either failed to file a Notice of Intent to Apply for its
allocation of program funds by November 26, 2010, or, after filing a
Notice of Intent, failed to submit an application to Treasury by June
27, 2011. Treasury officials stated that municipalities granted
permission to submit an application for program funds were generally
subject to the same approval criteria and program requirements as
states. Municipalities were eligible to apply for up to the total
amount of their state's SSBCI allocation, but the final approved
amounts were to be apportioned based on their pro rata share by
population of all applicants.[Footnote 11] Figure 1 provides a
timeline of major SSBCI milestones.
Figure 1: Timeline of Major SSBCI Milestones:
[Refer to PDF for image: timeline]
2010:
September 27:
The Small Business Jobs Act of 2010, which authorized SSBCI, was
enacted.
November 26:
Deadline for eligible states and territories to file a Notice of
Intent to Apply for SSBCI funds by June 27, 2011.
December 21:
Treasury makes SSBCI application materials, SSBCI policy guidance, and
allocation agreement available to states and territories.
2011:
January 14:
Treasury announces first SSBCI application approvals.
April 29:
Treasury issues updated SSBCI application materials, SSBCI policy
guidance, and revised allocation agreement.
May 19:
Treasury finalizes SSBCI reviewer's guide for application review.
June 27:
Deadline for eligible states and territories to apply for SSBCI funds.
September 27:
Deadline for municipalities to apply for SSBCI funds with Treasury
approval.
Source: GAO analysis of Treasury information.
[End of figure]
The act allowed Treasury to provide SSBCI funding for two state
program categories: capital access programs (CAP) and other credit
support programs (OCSP). A CAP is a loan portfolio insurance program
wherein the borrower and lender, such as a small business owner and a
bank, contribute to a reserve fund held by the lender. Under the act,
approved CAPs are eligible to receive federal contributions to the
reserve funds held by each participating financial institution in an
amount equal to the total amount of the insurance premiums paid by the
borrower and the lender on a loan-by-loan basis. Amounts in the
lender's reserve fund are then available to cover any losses incurred
in its portfolio of CAP loans. For an SSBCI loan to be eligible for
enrollment in a state's approved CAP, the borrower must have 500 or
fewer employees and the loan amount cannot exceed $5 million.
In addition, the following types of OCSPs are eligible to receive
SSBCI funds under the act:
* Collateral support programs: These programs supply cash collateral
accounts to lenders to enhance the collateral coverage of borrowers.
The accounts will cover all or a portion of the collateral shortfall
identified by a lending institution. These programs can be designed to
target certain regions or industries, such as equipment lending, in
which a lender may be willing to fund at 80 percent loan-to-value, but
a borrower may not be able to bridge the difference in cash at
closing.[Footnote 12]
* Loan participation programs: These programs enable small businesses
to obtain medium-to long-term financing, usually in the form of term
loans, to help them expand their businesses. States may structure a
loan participation program in two ways: (1) purchase transactions,
also known as purchase participation, in which the state purchases a
portion of a loan originated by a lender and (2) companion loans, also
known as co-lending participation or parallel loans, in which a lender
originates one loan and the state originates a second (usually
subordinate) loan to the same borrower. This program enables the state
to act as a lender, in partnership with a financial institution, to
provide small business loans at attractive terms.
* Direct loan programs: Although Treasury does not consider these
programs to be a separate SSBCI program type, it acknowledges that
some states may identify programs that they plan to support with SSBCI
funds as direct loan programs. The programs that some states label as
direct loan programs are viewed by Treasury as co-lending programs
categorized as loan participation programs, which have lending
structures that are allowable under the statute.
* Loan guarantee programs: These programs enable small businesses to
obtain term loans or lines of credit to help them grow and expand
their businesses by providing a lender with the necessary security, in
the form of a partial guarantee, for them to approve a loan or line of
credit. In most cases, a state sets aside funds in a dedicated reserve
or account to guarantee a specified percentage of each approved loan.
* Venture capital programs: These programs provide investment capital
to create and grow start-ups and early-stage businesses, often in one
of two forms: (1) a state-run venture capital fund (which may include
other private investors) that invests directly in businesses or (2) a
fund of funds, which is a fund that invests in other venture capital
funds that in turn invest in individual businesses. Many factors,
particularly resources and available talent, inform a state's decision
on which form to choose. For example, a state may choose to invest in
a large venture fund that agrees to reinvest in that state an amount
equal to that invested by the state, as opposed to trying to attract
that same talent to a smaller fund capitalized with state money.
* Qualified loan or swap funding facilities: States may enter into
qualifying loan or swap funding transactions under which SSBCI funds
are pledged as collateral for private loans or credit lines. The
private financing proceeds must, however, be used exclusively for the
reserve or other accounts that back the credit support obligations of
a borrowing CAP or OCSP. Presumably, fees paid by borrowers and
lenders will provide a return to the providers of private capital.
* Other OCSPs: States were also able to submit an application to
Treasury outlining their plans to support OCSPs that, though not able
to be categorized in any of the above OCSP types, feature combinations
of aspects of these eligible types.
OCSPs approved to receive SSBCI funds are required to target borrowers
with an average size of 500 or fewer employees and to target support
towards loans with average principal amounts of $5 million or less. In
addition, these programs cannot lend to borrowers with more than 750
employees or make any loans in excess of $20 million.
In applying for funding, applicants had to demonstrate that their CAPs
and OCSPs could satisfy SSBCI criteria. For example, applicant states
had to demonstrate that all legal actions had been taken at the state
level to accept SSBCI funds and implement the state programs. States
were also required to demonstrate that the state possessed the
operational capacity, skills, and financial and management capacity to
meet the objectives set forth in the act. In addition, each applicant
was required to demonstrate a "reasonable expectation" that its
participating programs, taken together, would generate an amount of
private financing and investment at least 10 times its SSBCI funding
(that is, a leverage ratio of 10:1) by the program's end in December
2016.[Footnote 13] Furthermore, each application had to include a
report detailing how the state would use its SSBCI allocation to
provide access to capital for small businesses in low-and moderate-
income, minority, and other underserved communities, including women-
and minority-owned small businesses.
The act requires that each state receive its SSBCI funds in three
disbursements of approximately one-third of its approved allocation.
Prior to receipt of the second and third disbursements, a state must
certify that it has expended, transferred, or obligated 80 percent or
more of the previous disbursement to or for the account of one or more
approved state programs. Treasury may terminate any portion of a
state's allocation that Treasury has not yet disbursed within 2 years
of the date on which its SSBCI Allocation Agreement was signed.
Treasury may also terminate, reduce, or withhold a state's allocation
at any time during the term of the Allocation Agreement upon an event
of default under the agreement. Following the execution of the
Allocation Agreement, states are required to submit quarterly and
annual reports on their use of SSBCI funds.[Footnote 14] All SSBCI
Allocation Agreements, the primary tool signed by Treasury and each
participating state, which outline how recipients are to comply with
program requirements, will expire on March 31, 2017.
Most States Are Participating in SSBCI and Plan to Use the Funds to
Support a Variety of Programs:
Nearly all of the states eligible for SSBCI funds submitted
applications to Treasury. Fifty-four of the 56 states and territories
that were eligible to apply for program funds submitted an application
prior to the June 27, 2011, deadline, although one state later
withdrew its application.[Footnote 15] In total, states requested more
than $1.4 billion in SSBCI funds--95 percent of the program's
appropriation--and only one applied for less than its maximum
allocation.[Footnote 16] Following the application deadline for
states, Treasury received five additional applications from
municipalities in three states--Alaska, North Dakota, and Wyoming--by
the September 27, 2011, deadline requesting a total of $39.5 million
in program funds. Figure 2 illustrates the distribution of SSBCI funds
applied for by states and territories.
Figure 2: Distribution of SSBCI Funds Applied for by States and
Territories:
[Refer to PDF for image: illustrated U.S. map]
Did not apply for funding:
Alaska;
North Dakota;
Wyoming.
Less than $15 million applied for:
Puerto Rico: $14.5;
Nevada: $13.8;
Connecticut: $13.3;
Guam: $13.2;
Northern Mariana Islands: $13.2;
U.S. Virgin Islands: $13.2;
District of Columbia: $13.2;
Arkansas: $13.2;
Delaware: $13.2;
Hawaii: $13.2;
Iowa: $13.2;
Idaho: $13.2;
Kansas: $13.2;
Louisiana: $13.2;
Maine: $13.2;
Mississippi: $13.2;
Montana: $13.2;
Nebraska: $13.2;
New Hampshire: $13.2;
New Mexico: $13.2;
Oklahoma: $13.2;
Rhode Island: $13.2;
South Dakota: $13.2;
Utah: $13.2;
Vermont: $13.2;
West Virginia: $13.2;
American Samoa: $10.38
$15 million - $30 million applied for:
Tennessee: $29.7;
Pennsylvania: $29.2;
Missouri: $26.9;
Maryland: $23.0;
Wisconsin $22.4;
Massachusetts: $22.0;
Washington: $19.7;
Arizona: $18.2;
South Carolina: $18.0;
Virginia: $18.0;
Colorado: $17.2;
Oregon: $16.5;
Kentucky: $15.5;
Minnesota: $15.5.
$30 million - $45 million applied for:
Indiana: $34.3;
New Jersey: $33.8;
Alabama: $31.3.
More than $45 million applied for:
California: $168.6;
Florida: $97.7;
Michigan: $79.2;
Illinois: $78.4;
New York: $55.4;
Ohio: $55.1;
Georgia: $47.8;
Texas: $46.6;
North Carolina: $46.1.
Source: GAO analysis of survey results; map (MapInfo).
[End of figure]
States Plan to Use SSBCI Funds to Support a Variety of New and
Existing Lending Programs:
Participating states indicated that they are planning to support
various new, existing, and dormant (that is, previously suspended)
lending programs with their respective SSBCI allocations. According to
our survey results, states are planning to support 153 different
lending programs, 69 of which are new programs that were created to be
supported by SSBCI funds (see figure 3). Forty-one states indicated
they are planning to support more than one program with their
allocation. For example, Alabama plans to support a CAP, four loan
participation programs, and a loan guarantee program, and New Jersey
plans to support a loan participation program, four loan guarantee
programs, five direct loan programs, and a venture capital program.
Figure 3: Planned Number and Type of New and Existing Programs to
Receive SSBCI Funds Reported by States and Territories, from Aug. 15
to Sept. 14, 2011:
[Refer to PDF for image: stacked vertical bar graph]
Venture capital:
Existing programs: 16;
New Programs: 19;
Total: 35.
Loan participation:
Existing programs: 17;
New Programs: 15;
Total: 32.
CAPs:
Existing programs: 18;
New Programs: 9;
Total: 27.
Loan guarantee:
Existing programs: 16;
New Programs: 9;
Total: 25.
Direct loan:
Existing programs: 12;
New Programs: 2;
Total: 14.
Collateral support:
Existing programs: 3;
New Programs: 9;
Total: 12.
Other OCSPs:
Existing programs: 2;
New Programs: 6;
Total: 8.
Source: GAO analysis of survey results.
Note: We asked officials from states and territories to report on the
planned number and type of programs that they described in their SSBCI
applications to Treasury. Our survey was administered from Aug. 15,
2011 through Sept. 14, 2011.
[End of figure]
According to our survey results, states are planning to support CAPs
and all types of eligible OCSPs except loan and swap funding
facilities (see figure 4). Venture capital programs are to receive the
largest amount of SSBCI funds of any program type. According to
Treasury officials, states submitted their respective applications
with plans for developing programs in response to unique gaps in local
markets or the specific expertise of their staff. Consequently, there
is variation in program design across states. For example, Treasury
officials stated that Michigan plans to use its funds to support a
collateral support program because of difficulties that manufacturing
companies in the state were experiencing in obtaining credit.
Specifically, Treasury officials noted that as these manufacturers'
real estate and equipment declined in value, they were facing
difficulties in obtaining credit due to collateral shortfalls (see
appendix IV for more information on planned uses of funds by location).
Figure 4: Planned Uses of SSBCI Funds by Eligible Program Type
Reported by States and Territories, from Aug. 15 to Sept. 14, 2011:
[Refer to PDF for image: illustrated horizontal bar graph]
Program type: Venture capital;
Funding: $336,467,264;
Number of states planning to support this program: 25;
Number of programs to receive SSBCI funds: 35.
Program type: Capital access;
Funding: $282,786,932;
Number of states planning to support this program: 27;
Number of programs to receive SSBCI funds: 27.
Program type: Loan participation;
Funding: $278,547,523;
Number of states planning to support this program: 23;
Number of programs to receive SSBCI funds: 32.
Program type: Loan guarantee;
Funding: $210,210,111;
Number of states planning to support this program: 19;
Number of programs to receive SSBCI funds: 25.
Program type: Collateral support;
Funding: $156,957,400;
Number of states planning to support this program: 12;
Number of programs to receive SSBCI funds: 12.
Program type: Other OCSPs[A];
Funding: $85,527,652
Number of states planning to support this program: 7;
Number of programs to receive SSBCI funds: 8.
Program type: Direct loan;
Funding: $70,359,728
Number of states planning to support this program: 9;
Number of programs to receive SSBCI funds: 14.
Source: GAO analysis of survey results.
Note: We asked officials from states and territories to report on the
planned uses of SSBCI funds that they described in their application
to Treasury. Our survey was administered from Aug. 15, 2011 through
Sept. 14, 2011.
[A] Other OCSPs cited by states included a working capital loan
program, a small business credit guarantee program, and programs that
featured combinations of program types.
[End of figure]
States Anticipate $18.7 Billion in New Private Financing and
Investment Due to SSBCI Funds, and Expected Leverage Ratios Vary:
States indicated that they expect SSBCI funds to result in a total of
$18.7 billion in new private financing and investment throughout the
life of the program. In responding to our survey, officials from 39 of
the states that applied for SSBCI funds indicated that they expect to
achieve a private leverage ratio between 10:1 and 15:1, and 14
projected a ratio of 15:1 or greater.[Footnote 17] However, each
participating state's generation of an amount of private financing and
investment at least 10 times its SSBCI allocation by December 2016 is
not a requirement, and some states indicated that they believe
reaching a 10:1 private leverage ratio could prove challenging. For
example, officials from one state expressed some concern that the
state's final leverage ratio may ultimately fall short of the estimate
included in its approved application because the state was creating a
new program and, therefore, did not have prior experience operating a
similar program. Treasury officials noted that a state's mix of
programs, as well as the design of each individual program, drives the
leverage estimates. For example, Treasury officials stated that
private leverage ratios for CAPs tend to be the highest among program
types and are evident immediately because the program design is such
that the SSBCI subsidy per loan is quite small and is not dependent on
subsequent private financing.[Footnote 18] However, the officials
noted that OCSPs tend to have lower leverage ratios initially but may
see those grow in later years as program funds are recycled for
additional lending over time.
Treasury's Evolving Processes Have Created Some Delays:
Treasury Revised Its Application Guidance and Review Procedures to
Clarify Requirements and Thoroughly Reviewed Selected Applications:
With the enactment of the Small Business Jobs Act of 2010 on September
27, 2010, Treasury was tasked with quickly starting up an SSBCI
program office and developing processes and guidance to implement this
new program. After accepting Notices of Intent to Apply from states
and territories by the end of November 2010, Treasury issued an
initial set of policy guidelines and application materials via its
website on December 21, 2010. According to Treasury officials,
Treasury received a few applications shortly thereafter and was able
to review and approve them and to obtain signed Allocation Agreements
with and distribute first installments of funds to two states in
January 2011. In response to feedback from states, discussions with
other federal agencies, such as the Small Business Administration, and
current trends in the small business banking arena, Treasury
determined that it needed to revise its guidelines and application
paperwork to better articulate what documentation was required for
both the application and review processes. As a result, Treasury
issued revised guidance materials and Allocation Agreements for
applicants in April 2011 as well as a reviewers' manual for its review
staff in May 2011. According to our survey of SSBCI applicants, five
states submitted the final version of their application to Treasury
before these documents were finalized. Treasury officials told us that
although they took steps to help ensure consistent treatment of
applicants, Treasury did not revisit previously approved applications
once review procedures were finalized. Treasury officials said they
were confident that no additional review was required, as those early
applications were from states with well-established programs. However,
as a result of the revisions to the Allocation Agreement made in April
2011, Treasury asked the two states that had signed the previous
versions to sign an amended Allocation Agreement that incorporated the
new terms.
Some states reported that they delayed submitting their applications
until Treasury's final application guidance was issued. According to
our survey results, 37 states did not submit their final applications
for SSBCI funds until June 2011, the month that applications were due.
Despite the delay in providing application guidance, applicants
generally viewed Treasury officials as helpful throughout the
application process--providing answers to most questions immediately
and determining answers as soon as possible when not readily
available. Treasury officials stated that they also hosted multiple
webinars and conference calls to field questions about the application
process that were highly attended by states and territories.
In our review of the eight applications reviewed and approved before
June 30, 2011, we found that Treasury considered each aspect of the
application.[Footnote 19] Although only one of the applications we
reviewed was processed under the revised application and review
guidelines, we found that each application was subject to five stages
of review: an initial review, a subsequent review by a quality
assurance reviewer, review by the application review committee, a
legal review, and final approval by the designated Treasury official.
Our reviews of the applications and the experiences of the states
suggest that applications were scrutinized in terms of their
completeness as well as the eligibility of the programs for which
states intended to use SSBCI funds. For example, Treasury reviewers
noted that in one state's application, the state proposed several
modifications to its existing CAP, thereby bringing it under
compliance with SSBCI requirements. Similarly, SSBCI applicants
reported that Treasury scrutinized their applications. According to
our survey results, 50 of the 54 applicants reported they were
required to resubmit at least parts of their applications for further
review after their original submissions. For example, one state noted
that Treasury wanted significant changes in its application, mainly in
the areas of internal controls, mix of programs, and contractor
oversight. Another state noted that Treasury determined that the state
failed to specify that it was to match the borrower and lender premium
between 2 percent and 3.5 percent; Treasury officials asked the state
to revise its application to reflect this information and submit an
amended application.
Delays in Finalizing Disbursement Procedures Slowed the Disbursement
of Funds:
As required under the act, Treasury is distributing SSBCI funds to
recipients in three installments. As of October 31, 2011, Treasury had
provided first installments to 46 states and territories, totaling
about $424 million. However, Treasury did not begin processing state
requests for their second installment of funds until November 2011.
According to Treasury officials, Treasury had previously not acted on
these requests because they wanted to ensure that proper procedures
were established to ensure all certifications made as part of the
request were adequately substantiated. Specifically, they had to
resolve how to determine whether 80 percent of a state's initial
disbursement of funds has been expended, transferred, or obligated as
required under the act.[Footnote 20] Treasury finalized its
disbursement procedures for second and third installments of SSBCI
funds at the beginning of November 2011. According to Treasury
officials, as of that date, no state had yet expended 80 percent of
its initial disbursement to support loans or investment to small
businesses.
While Treasury was working to finalize these procedures, states were
potentially delayed in receiving their remaining SSBCI funding. For
example, officials from one state that we contacted told us they were
ready for their second installment after their first installment was
transferred to the accounts of their designated SSBCI lending
programs, but they were told by Treasury officials that they would
have to wait until the disbursement procedures were finalized.
Consequently, the officials told us their state faced additional
interest expenses as a result of the delay.
Treasury Is Implementing a Plan to Monitor Recipient Compliance with
Program Requirements:
Treasury is implementing a multi-step plan to monitor recipient
compliance with SSBCI program requirements. These steps include (1)
collecting and reviewing quarterly and annual reports, as well as
quarterly use of funds certifications, from recipients, (2) evaluating
the accuracy of recipient-level reporting on an annual basis by
sampling transaction-level data, (3) monitoring recipient requests for
second and third installments of SSBCI funds, and (4) contacting
recipients on a quarterly basis to inquire as to their adherence with
plans outlined in their respective SSBCI applications, as well as
monitoring requirements. Treasury has developed a secure, online
system for states to report on those data fields included in the
Allocation Agreements signed by states, including (1) total amount of
principal loaned and of that amount, the portion that is from
nonprivate sources; (2) estimated number of jobs created or retained
as a result of the loan; and (3) amount of additional private
financing occurring after the loan closing. States are to provide
these data to Treasury on an annual basis beginning in March 2012.
[Footnote 21] Treasury officials told us they plan to sample states'
transaction-level data to help ensure the accuracy of state reporting.
Specifically, the SSBCI compliance manager is to take samples of
transaction-level data from all recipients in order to determine
whether states are entering these data accurately, including verifying
that transactions listed match the underlying loan or investment
documents. Treasury officials noted that the system is to
automatically flag any loans for which the data entered do not comply
with program requirements.
Treasury officials told us they have also assigned three relationship
managers to serve as the primary Treasury contacts for the SSBCI
program. These managers, who have each been assigned 15 to 20
recipients, are to hold quarterly phone conversations with recipients.
During these calls, the managers are to ask a series of generic
questions, as well as recipient-specific questions regarding plans the
states described in their applications, such as hiring staff and
monitoring the use of program funds.
The Treasury Inspector General recently made recommendations to
further enhance Treasury's oversight of SSBCI recipients. In August
2011, the Inspector General issued a report describing the results of
its review of SSBCI policy guidance and other key program documents,
including allocation agreements.[Footnote 22] The report made nine
recommendations to improve Treasury's compliance and oversight
framework, including that Treasury's guidance should clearly define
the oversight obligations of recipients and specify minimum standards
for determining whether recipients have fulfilled their oversight
responsibilities. Treasury concurred with eight of the recommendations
and has begun to take action to address them. Treasury disagreed with
the Inspector General's recommendation to make additional provisions
for states to certify their allocation agreements, stating that states
certify that they are implementing their programs in compliance with
SSBCI procedures as part of their quarterly reporting to Treasury.
Treasury Is in the Process of Developing Performance Measures for
SSBCI:
Treasury officials told us that they have not yet established
performance measures for the SSBCI program. Although Treasury plans to
rely primarily on the department's overall performance measures in
evaluating the SSBCI program, officials noted they are considering
several draft performance measures to assess the efficiency of the
program. Treasury officials described to us some of the potential
measures they are considering, but we are not including them in this
report because they have not yet been finalized. Treasury officials
told us that they have not finalized the program's performance
measures because they have been focused on starting up the program
quickly to meet statutorily required deadlines. Furthermore, officials
noted that because SSBCI is a multilayered program that is implemented
at the state level and dependent upon private sector entities,
Treasury's ability to influence program outcomes will be limited.
Therefore, Treasury officials have been trying to develop measures
that focus on the aspects of the program under Treasury's control.
According to Treasury officials they do not have a time frame for
fully developing and finalizing SSBCI-specific performance measures.
The potential performance measures described by Treasury do not
currently include measures related to the number of jobs created or
retained as a result of the SSBCI program. As required in their
allocation agreements with Treasury, states are to report information
on estimated jobs resulting from SSBCI programs on a per loan or
investment basis. According to Treasury officials, gathering this
information from the states serves two purposes: (1) it allows
Treasury to track the progress of the states against the anticipated
benefits articulated for their programs in their SSBCI applications
and (2) it provides Treasury with a potential data point that may be
useful when measuring overall program performance over time. However,
Treasury's ability to use this information moving forward could be
limited, as the jobs data will be based on estimates and not actual
jobs. In particular, as part of the SSBCI loan and investment
application process, borrowers and investors are required to provide
in their application paperwork estimates of the number of jobs to be
created and retained as a result of participating in SSBCI programs.
States then provide these estimates in their annual reports to
Treasury. However, the states are not required to validate these jobs
estimates, and they are not required to follow up with borrowers and
investors to determine whether the actual number of jobs they were
able to create or retain matched their original estimates. According
to one lending official we spoke with, validating these estimates
would be difficult and lenders could be discouraged from participating
in the SSBCI program if they were required to track actual jobs
created and retained. Concerned about the burden that reporting on
actual jobs created and retained would place on the small businesses
receiving SSBCI funds, Treasury officials told us that they elected to
capture instead estimated jobs data at the time of the closing of the
loan or investment. Treasury officials noted they are currently
consulting with officials from the Small Business Administration to
learn what methods that agency uses in measuring jobs using estimated
data.
The importance of performance measures for gauging the progress of
programs and projects is well recognized. Measuring performance allows
organizations to track the progress they are making toward their goals
and gives managers crucial information on which to base their
organizational and management decisions. Leading organizations
recognize that performance measures can create powerful incentives to
influence organizational and individual behavior. In addition, the
Government Performance and Results Act of 1993 (GPRA) incorporates
performance measurement as one of its most important features.
[Footnote 23] Under GPRA, executive branch agencies are required to
develop annual performance plans that use performance measurement to
reinforce the connection between the long-term strategic goals
outlined in their strategic plans and the day-to-day activities of
their managers and staff. The Office of Management and Budget (OMB)
has also directed agencies to define and select meaningful outcome-
based performance measures that indicate the intended result of
carrying out a program or activity.[Footnote 24] Additionally, we have
previously reported that aligning performance metrics with goals can
help to measure progress toward those goals, emphasizing the quality
of the services an agency provides or the resulting benefits to users.
[Footnote 25]
We have also previously identified criteria to evaluate an agency's
performance measures. While GPRA focuses on the agency level,
performance measures are important management tools for all levels of
an agency--such as the bureau, program, project, or activity level--
and these criteria are applicable at those levels as well. Among other
criteria, we have identified nine key attributes of successful
performance measures.[Footnote 26] These attributes include the
following:
(1) Linkage. Measure is aligned with division-and agency-wide goals
and mission and clearly communicated throughout the organization.
(2) Clarity. Measure is clearly stated, and the name and definition
are consistent with the methodology used to calculate it.
(3) Measurable target. Measure has a numerical goal.
(4) Objectivity. Measure is reasonably free from significant bias or
manipulation.
(5) Reliability. Measure produces the same result under similar
conditions.
(6) Core program activities. Measures cover the activities that an
entity is expected to perform to support the intent of the program.
(7) Limited overlap. Measure should provide new information beyond
that provided by other measures.
(8) Balance. Balance exists when a suite of measures ensures that an
organization's various priorities are covered.
(9) Governmentwide priorities. Each measure should cover a priority
such as quality, timeliness, and cost of service.
Given the preliminary nature of Treasury's potential performance
measures, assessing whether the measures will reflect the attributes
of successful performance measures would be premature. Nevertheless,
considering these attributes as it works to finalize SSBCI-specific
performance measures could help Treasury to develop robust measures.
Until such measures are developed and implemented, Treasury will not
be able to determine whether the program is achieving its goals.
Conclusions:
In response to SSBCI's short time frame, Treasury was able to design,
implement, and execute an application process for the program in a
matter of months. Appropriately, Treasury's early efforts were focused
on establishing the application process and the process for disbursing
initial installments of funds to recipients as quickly as possible.
Treasury is still in the process of developing performance measures
for the SSBCI program. Measuring performance allows organizations to
track progress toward their goals and gives managers crucial
information on which to base decisions. At the program level, agencies
can create a set of performance measures that addresses important
dimensions of program performance and balances competing priorities.
Performance measures that successfully address important and varied
aspects of program performance are key elements of an orientation
toward results. Effective performance measures can provide a balanced
perspective on the intended performance of a program's multiple
priorities. While Treasury is considering potential draft performance
measures, it has not fully developed or finalized a set of measures
for the SSBCI program. Until such measures are developed and
implemented, Treasury will not be in a position to determine whether
the SSBCI program is effective in achieving its goals.
Recommendation for Executive Action:
We are making one recommendation to Treasury to improve its
implementation and oversight of the SSBCI program as follows:
* To help ensure that the performance measures for the SSBCI program
are as robust and meaningful as possible, we recommend that the
Secretary of the Treasury direct the SSBCI Program Manager to consider
key attributes of successful performance measures as the program's
measures are developed and finalized.
Agency Comments and Our Evaluation:
We provided a draft of this report to Treasury for review and comment.
Treasury provided written comments that we have reprinted in appendix
V. Treasury also provided technical comments, which we have
incorporated, as appropriate.
In their written comments, Treasury agreed with our recommendation.
Treasury noted that it will consider the key attributes of successful
performance measures as it works to finalize measures for the SSBCI
program.
We are sending copies of this report to the appropriate congressional
committees, the Secretary of the Treasury, and other interested
parties. The report is also available at no charge on the GAO website
at [hyperlink, http://www.gao.gov].
If you or your staff members have any questions about this report,
please contact me at clowersa@gao.gov or (202) 512-8678. Contact
points for our Offices of Congressional Relations and Public Affairs
may be found on the last page of this report. GAO staff who made major
contributions to this report are listed in appendix VI.
Signed by:
A. Nicole Clowers:
Director, Financial Markets and Community Investment:
List of Committees:
The Honorable Debbie Stabenow:
Chairwoman:
The Honorable Pat Roberts:
Ranking Member:
Committee on Agriculture, Nutrition, and Forestry:
United States Senate:
The Honorable Daniel K. Inouye:
Chairman:
The Honorable Thad Cochran:
Ranking Member:
Committee on Appropriations:
United States Senate:
The Honorable Tim Johnson:
Chairman:
The Honorable Richard C. Shelby:
Ranking Member:
Committee on Banking, Housing, and Urban Affairs:
United States Senate:
The Honorable Kent Conrad:
Chairman:
The Honorable Jeff Sessions:
Ranking Member:
Committee on the Budget:
United States Senate:
The Honorable Max Baucus:
Chairman:
The Honorable Orrin G. Hatch:
Ranking Member:
Committee on Finance:
United States Senate:
The Honorable Mary L. Landrieu:
Chair:
The Honorable Olympia J. Snowe:
Ranking Member:
Committee on Small Business and Entrepreneurship:
United States Senate:
The Honorable Frank D. Lucas:
Chairman:
The Honorable Collin C. Peterson:
Ranking Member:
Committee on Agriculture:
House of Representatives:
The Honorable Hal Rogers:
Chairman:
The Honorable Norm Dicks:
Ranking Member:
Committee on Appropriations:
House of Representatives:
The Honorable Paul Ryan:
Chairman:
The Honorable Chris Van Hollen:
Ranking Member:
Committee on the Budget:
House of Representatives:
The Honorable Spencer Bachus:
Chairman:
The Honorable Barney Frank:
Ranking Member:
Committee on Financial Services:
House of Representatives:
The Honorable Sam Graves:
Chairman:
The Honorable Nydia M. Velázquez:
Ranking Member:
Committee on Small Business:
House of Representatives:
The Honorable Dave Camp:
Chairman:
The Honorable Sander M. Levin:
Ranking Member:
Committee on Ways and Means:
House of Representatives:
[End of section]
Appendix I: Objectives, Scope, and Methodology:
To determine which states applied for and received State Small
Business Credit Initiative (SSBCI) funds and the planned uses of the
funds, we developed a Web-based questionnaire to collect information
from the 54 states and territories that filed a Notice of Intent to
Apply for SSBCI funds with the Department of the Treasury (Treasury)
by the November 26, 2010 deadline.[Footnote 27] The questionnaire
included questions on the timing of applications for SSBCI funds, the
receipt of funds to date, the intended uses of funds, and the
potential impacts of program funds. See appendix II for a copy of the
questionnaire.
To minimize errors arising from differences in how questions might be
interpreted and to reduce variability in responses that should be
qualitatively the same, we conducted pretests with officials in three
states, both in person and over the telephone. To help ensure that we
obtained a variety of perspectives on our questionnaire, we selected
officials from states planning to support various types of programs
with SSBCI funds. Based on feedback from these pretests, we revised
the questionnaire in order to improve response quality. For instance,
in response to one state official's comment that it would be difficult
for respondents to answer with confidence how many capital access
programs (CAP) and other credit support programs (OCSP) have recently
been in operation across all municipalities in a state, we removed the
historical and specific program budget questions and clarified our
focus on the planned uses of SSBCI funds. We conducted two additional
pretests with other state officials to ensure that the updated
questionnaire was understandable.
After completing the pretests, we administered the survey. On August
4, 2011, we began sending e-mail announcements of the questionnaire to
the state and territory officials that had been identified as points
of contact in a list provided to us by Treasury, notifying them that
our online questionnaire would be activated in approximately 1 week.
On August 15, 2011, we sent a second e-mail message to officials in
which we informed them that the questionnaire was available online and
provided them with unique passwords and usernames. On August 26, 2011,
we began making telephone calls to officials and sent them follow-up e-
mail messages, as necessary, to ensure their participation as well as
to clarify and gain a contextual understanding of their responses. By
September 14, 2011, we had received completed questionnaires from 54
states and territories, for a 100 percent response rate.
We used standard descriptive statistics to analyze responses to the
questionnaire. Because this was not a sample survey, there are no
sampling errors. To minimize other types of errors, commonly referred
to as nonsampling errors, and to enhance data quality, we employed
recognized survey design practices in the development of the
questionnaire and in the collection, processing, and analysis of the
survey data. For instance, as previously mentioned, we pretested the
questionnaire with state officials to minimize errors arising from
differences in how questions might be interpreted and to reduce
variability in responses that should be qualitatively the same. In
addition, during survey development, we reviewed the survey to ensure
the ordering of survey sections was appropriate and that the questions
within each section were clearly stated and easy to comprehend. We
also received feedback from survey experts who we asked to review the
survey instrument. To reduce nonresponse, another source of
nonsampling error, we sent out e-mail reminder messages to encourage
officials to complete the survey. In reviewing the survey data, we
performed automated checks to identify inappropriate answers. We
further reviewed the data for missing or ambiguous responses and
followed up with respondents when necessary to clarify their
responses. On the basis of our application of recognized survey design
practices and follow-up procedures, we determined that the data were
of sufficient quality for our purposes.
In addition to the survey, we conducted interviews with Treasury
officials, as well as selected state officials and financial
institutions within those states either via teleconference or site
visits to collect documentation that informed our understanding of
states' planned uses of SSBCI funds. We limited our selection of
states to interview to those states whose SSBCI applications had been
reviewed, approved, and for which the applicant had signed an
allocation agreement by June 30, 2011: California, Hawaii, Indiana,
Kansas, Maryland, Missouri, North Carolina, and Vermont.
To evaluate Treasury's implementation of the SSBCI program, we
compared and contrasted Treasury's SSBCI procedures and planned
control activities with GAO's internal control standards, including
Internal Control in the Federal Government.[Footnote 28] We
interviewed Treasury officials about the types of training it provided
its staff to help ensure compliance with its procedures. We also
utilized data obtained through our questionnaire to identify the dates
on which states submitted their SSBCI applications and whether
Treasury required resubmission. Additionally, we reviewed a
nonprobability sample of SSBCI applications consisting of all eight
states that had signed an SSBCI allocation agreement by June 30, 2011,
to determine whether all aspects of these states' applications were
considered. We assessed whether Treasury followed its procedures and
appropriately documented its decisions by analyzing the documentation
of the application reviews. Because we used a nongeneralizable sample
to select the applications to review, our findings cannot be used to
make inferences about SSBCI applications of states that signed
allocation agreements after June 30, 2011. However, we determined that
the sample would be useful in providing illustrative examples on
procedures and documentation practices applied by Treasury.
Furthermore, we conducted interviews with Treasury officials about the
type of testing the agency plans to perform of its controls to ensure
compliance with SSBCI procedures, lessons learned about the review
process, how they addressed problems, and their plans to follow up
with states to ensure that SSBCI funds are used for the intended
purposes outlined in approved applications for program funds.
To review Treasury's efforts to measure whether the SSBCI program
achieves its goals of increasing small business investment and
creating jobs, we discussed with Treasury their proposed performance
metrics for the SSBCI program. We also interviewed Treasury officials,
as well as officials from the eight states that had signed a SSBCI
allocation agreement with Treasury by June 30, 2011, to collect
documentation that was used to inform our understanding of SSBCI
program performance and Treasury's metrics.
We conducted this performance audit from February 2011 to December
2011 in accordance with generally accepted government auditing
standards. Those standards require that we plan and perform the audit
to obtain sufficient, appropriate evidence to provide a reasonable
basis for our findings and conclusions based on our audit objectives.
We believe that the evidence obtained provides a reasonable basis for
our findings and conclusions based on our audit objectives.
[End of section]
Appendix II: Copy of GAO Questionnaire:
GAO Survey of States and Territories Filing a NOI for SSBCI Funding:
U.S. Government Accountability Office:
Introduction:
This brief questionnaire is divided into four sections with most
questions related to information provided in your SSBCI application.
The survey will take about 20 minutes to complete, but does not need
to be completed in one sitting. Your responses can be saved and
accessed at a later date. To learn more about completing the
questionnaire, printing your responses, and whom to contact if you
have questions click here for help.
In order to answer some of the survey questions, you may need to
consult staff in your agency's budget office or budgetary documents
such as your SSBCI application. In general, if you are unsure of how
to respond to a question, please consult with others in your agency
that are familiar with the history of your state's programs. You may
also contact one of the GAO staff listed on the left side of your
screen.
Thank you for your time and assistance.
Section I: Application for SSBCI Funds:
This section of the questionnaire asks questions about funding your
state or territory may have applied for and received through the State
Small Business Credit Initiative (SSBCI). Later sections of the
questionnaire will address the uses and potential impact of these
funds with regards to capital access programs (CAPS) and other capital
support programs (OCSPs).
1. Did _____ submit an application to obtain State Small Business
Credit Initiative (SSBCI) funds?
(cheek only one answer)
1. Yes (click here to skip to question 3);
2. No (continue to question 2).
2. Because your state did not apply for SSBCI funds, which
municipalities in ___, if any, plan to apply for SSBCI funds? (Enter
names in spaces provided Otherwise, check "Not Applicable" or "Not
Sure.")
Municipality #1:
Not applicable:
Which municipalities plan to apply? (Enter names in boxes):
Not sure:
Municipality #2:
Not applicable:
Which municipalities plan to apply? (Enter names in boxes):
Not sure:
Municipality #3:
Not applicable:
Which municipalities plan to apply? (Enter names in boxes):
Not sure:
After answering question 2 above, click here to skip to question 18.
3. When did _____ originally submit its application to Treasury to
obtain SSBCI funds? If _____ only submitted its application once,
please select that date by clicking on the calendar icon.)
(click calendar icon to select date)
4. Did Treasury require _____ to resubmit its SSBCI application?
(check only one answer)
1. Yes: (Continue to Question 5)
2. No: (click here to skip to question 6)
5. When did _____ submit the final version of its SSBCI application to
Treasury, and why did Treasury require _____ to resubmit its
application? (Select that date by clicking on the calendar icon in the
space provided and then describe why _____ was required to resubmit
its application)
(click calendar icon to select date)
5a. Please describe why your state needed to resubmit its application
to Treasury:
6. When did _____ sign its original allocation agreement for SSBCI
funds with Treasury? (Select that date by clicking on the calendar
icon or check "Not yet signed")
1.Not yet signed:
Date signed (click calendar icon to select date)
7. According to public information published by the U.S. Treasury, the
maximum amount of SSBCI funds allotted to _____ under SSBCI is: _____.
What was the exact amount _____ actually applied for? (Enter dollar
amount in the spaces provided or check "Same as maximum amount")
1. Same as maximum amount:
(Enter amount in whole dollars): $
8. When did _____ receive its first, second, and third installments of
SSBCI funds? (Select that date by clicking on the calendar icon or check
"Not received to date" if applicable)
Installment: First:
Date received:
Not received to date:
Installment: Second:
Date received:
Not received to date:
Installment: Third:
Date received:
Not received to date:
9. What is the total amount of SSBCI funds _____has received to date?
(Enter whole dollar amount in the space provided or enter "0" if none)
Section 2: Intended Uses of SSBCI Funds:
10. How many of the following types of programs does _____ intend to
support with SSBCI funds, and what is the total amount of SSBCI
funding to be used for each of the program types? (For each program
type, enter the number of programs and whole dollar amount in the
space provided)
Program type: Capital access program(s):
Number of programs:
Total amount of funding:
Program type: Collateral support program(s):
Number of programs:
Total amount of funding:
Program type: Loan participation program(s):
Number of programs:
Total amount of funding:
Program type: Loan guarantee program(s):
Number of programs:
Total amount of funding:
Program type: Direct loan program(s):
Number of programs:
Total amount of funding:
Program type: Loan or swap funding facility program(s):
Number of programs:
Total amount of funding:
Program type: Venture capital program(s):
Number of programs:
Total amount of funding:
Program type: Other (please specify below):
Number of programs:
Total amount of funding:
If "Other OCSP", please specify:
11. Of the programs you counted in Question 10, how many also received
federal funding besides SSBCI funding in Calendar Year 2011 and what
was (were) the federal source(s) providing the additional funding?
(For each program type, enter the number of programs and name (s) of
the program(s) in the spaces provided)
Program type: Capital access program(s):
Number of programs:
Names of other sources:
Program type: Collateral support program(s):
Number of programs:
Names of other sources:
Program type: Loan participation program(s):
Number of programs:
Names of other sources:
Program type: Loan guarantee (s):
Number of programs:
Names of other sources:
Program type: Direct loan program(s):
Number of programs:
Names of other sources:
Program type: Loan or swap funding facility program(s):
Number of programs:
Names of other sources:
Program type: Venture capital program(s):
Number of programs:
Names of other sources:
Program type: Other (please specify below):
Number of programs:
Names of other sources:
If "Other OCSP", please specify:
12. Of the programs counted in Question 10, how many new (i.e., never
previously operated) programs does _____ intend to create to utilize
SSBCI funds? (For each program type, enter value or "0" in boxes)
Program type: Capital access program(s);
Number of new programs:
Program type: Collateral support program(s);
Number of new programs:
Program type: Loan participation program(s);
Number of new programs:
Program type: Loam guarantee program(s);
Number of new programs:
Program type: Direct loan program(s);
Number of new programs:
Program type: Loan or swap funding facility program(s);
Number of new programs:
Program type: Venture capital program(s);
Number of new programs:
Program type: Other OCSP (please specify below);
Number of new programs:
If "Other OCSP", please specify:
Section 3: Potential Impacts of SSBCI Funds:
13. Based on your best estimates, what is the total amount of private
financing and investment you project will result from all of the SSBCI
funds for which _____ has applied, and how did you arrive at that
projection? (Enter whole dollar amount in the space provided; then
describe the methodology you used to arrive at that projection in the
space provided)
13a. Please describe the methodology you used to arrive at this
projection:
14. Based on your best estimates, what overall private leverage ratio
do you project _____ will achieve among all of its SSBCI-funded
program(s)? (Enter ratio in XX:l format (e.g., 12.9:1)
15. The private leverage ratio can he calculated over three distinct
time horizons, at the election of each state applying for SSBCI funds.
Which of the private leverage ratio calculations allowed in the SSBCI
application did you use to arrive at the ratio provided in question
14? (Please click here to see the definitions taken from Treasury's
SSBCI guidance)
(check only one answer)
1. Private leverage ratio.
2. Cumulative private leverage ratio.
3. Allocation time period private leverage ratio.
16. Based on your best estimates for the period of time between
receipt of funds and March 2017, how many new or retained lobs do you
project the allocation of SSBCI funds to _____ will likely bring, and
how did you arrive at this projection? (Enter number of new jobs in
the box below or check "Not Sure"; then describe the methodology you
used to arrive at that projection in the space provided including how
_____ defines "new" and "retained" jobs or explain why you checked
"Not Sure").
Projected number of new or retained:
Number of jobs:
Not sure:
16a. Please describe the methodology you used to arrive at this
projection including how _____ defines "new" and "retained" jobs or
explain why you checked "Not Sure":
Section 4: Concluding Comments and Contact Information:
17. If you have any additional thoughts or comments about SSBCI,
please share them here. Your answer to this question is very important
for understanding any challenges states and territories may have
encountered and possible measures that could be taken to improve the
SSBCI.
18. Please provide the contact information of the person best able to
answer any follow-up questions pertaining to questionnaire responses.
Name:
Title:
Department:
Phone number:
E-mail address:
Submit your responses to GAO:
19. This completes our survey: Are you ready to submit your final
completed survey to GAO? (check only one answer)
1. Yes, my survey is complete - To submit your final responses, please
click on "Exit and Save" below.
2. No, my survey is not yet complete - To save your responses for
later, please click on "Exit and Save" below.
View and print responses:
You may view and print your completed survey by clicking on the
Summary link in the menu to the left.
Print screen:
Submit:
[End of section]
Appendix III: SSBCI Funds Applied for, Approved, and Disbursed, by
Location, as of October 31, 2011:
Table 1 below contains the amounts of SSBCI funds that have been
applied for, approved, and disbursed as of October 31, 2011. This
information was provided by state and territory officials who
responded to a GAO survey between August 15 and September 14, 2011 and
by the U.S. Treasury on October 31, 2011.
Table 1: SSBCI Funds Applied for, Approved, and Disbursed, by
Location, as of October 31, 2011:
SSBCI-eligible state/territory: California;
SSBCI allocation amount applied for by state/territory: $168,623,821;
Amount of SSBCI funds approved by Treasury: $168,623,821;
Amount of SSBCI funds disbursed by Treasury: $55,645,861.
SSBCI-eligible state/territory: Florida;
SSBCI allocation amount applied for by state/territory: $97,662,349;
Amount of SSBCI funds approved by Treasury: $97,662,349;
Amount of SSBCI funds disbursed by Treasury: $32,228,575.
SSBCI-eligible state/territory: Michigan;
SSBCI allocation amount applied for by state/territory: $79,157,742;
Amount of SSBCI funds approved by Treasury: $79,157,742;
Amount of SSBCI funds disbursed by Treasury: $26,122,055.
SSBCI-eligible state/territory: Illinois;
SSBCI allocation amount applied for by state/territory: $78,365,264;
Amount of SSBCI funds approved by Treasury: $78,365,264;
Amount of SSBCI funds disbursed by Treasury: $25,860,537.
SSBCI-eligible state/territory: New York;
SSBCI allocation amount applied for by state/territory: $55,351,534;
Amount of SSBCI funds approved by Treasury: $55,351,534;
Amount of SSBCI funds disbursed by Treasury: $18,266,006.
SSBCI-eligible state/territory: Ohio;
SSBCI allocation amount applied for by state/territory: $55,138,373;
Amount of SSBCI funds approved by Treasury: $55,138,373;
Amount of SSBCI funds disbursed by Treasury: $18,195,663.
SSBCI-eligible state/territory: Georgia;
SSBCI allocation amount applied for by state/territory: $47,808,507;
Amount of SSBCI funds approved by Treasury: $0;
Amount of SSBCI funds disbursed by Treasury: $0.
SSBCI-eligible state/territory: Texas;
SSBCI allocation amount applied for by state/territory: $46,553,879;
Amount of SSBCI funds approved by Treasury: $46,553,879;
Amount of SSBCI funds disbursed by Treasury: $15,362,780.
SSBCI-eligible state/territory: North Carolina;
SSBCI allocation amount applied for by state/territory: $46,061,319;
Amount of SSBCI funds approved by Treasury: $46,061,319;
Amount of SSBCI funds disbursed by Treasury: $15,200,235.
SSBCI-eligible state/territory: Indiana;
SSBCI allocation amount applied for by state/territory: $34,339,074;
Amount of SSBCI funds approved by Treasury: $34,339,074;
Amount of SSBCI funds disbursed by Treasury: $11,331,894.
SSBCI-eligible state/territory: New Jersey;
SSBCI allocation amount applied for by state/territory: $33,760,698;
Amount of SSBCI funds approved by Treasury: $33,760,698;
Amount of SSBCI funds disbursed by Treasury: $11,141,030.
SSBCI-eligible state/territory: Alabama;
SSBCI allocation amount applied for by state/territory: $31,301,498;
Amount of SSBCI funds approved by Treasury: $31,301,498;
Amount of SSBCI funds disbursed by Treasury: $10,329,494.
SSBCI-eligible state/territory: Tennessee;
SSBCI allocation amount applied for by state/territory: $29,672,070;
Amount of SSBCI funds approved by Treasury: $29,672,070;
Amount of SSBCI funds disbursed by Treasury: $9,791,783.
SSBCI-eligible state/territory: Pennsylvania;
SSBCI allocation amount applied for by state/territory: $29,241,232;
Amount of SSBCI funds approved by Treasury: $29,241,232;
Amount of SSBCI funds disbursed by Treasury: $9,649,607.
SSBCI-eligible state/territory: Missouri;
SSBCI allocation amount applied for by state/territory: $26,930,294;
Amount of SSBCI funds approved by Treasury: $26,930,294;
Amount of SSBCI funds disbursed by Treasury: $8,886,997.
SSBCI-eligible state/territory: Maryland;
SSBCI allocation amount applied for by state/territory: $23,025,709;
Amount of SSBCI funds approved by Treasury: $23,025,709;
Amount of SSBCI funds disbursed by Treasury: $7,598,484.
SSBCI-eligible state/territory: Wisconsin;
SSBCI allocation amount applied for by state/territory: $22,363,554;
Amount of SSBCI funds approved by Treasury: $22,363,554;
Amount of SSBCI funds disbursed by Treasury: $7,379,973.
SSBCI-eligible state/territory: Massachusetts;
SSBCI allocation amount applied for by state/territory: $22,032,072;
Amount of SSBCI funds approved by Treasury: $22,032,072;
Amount of SSBCI funds disbursed by Treasury: $7,270,584.
SSBCI-eligible state/territory: Washington;
SSBCI allocation amount applied for by state/territory: $19,722,515;
Amount of SSBCI funds approved by Treasury: $19,722,515;
Amount of SSBCI funds disbursed by Treasury: $0.
SSBCI-eligible state/territory: Arizona;
SSBCI allocation amount applied for by state/territory: $18,204,217;
Amount of SSBCI funds approved by Treasury: $18,204,217;
Amount of SSBCI funds disbursed by Treasury: $0.
SSBCI-eligible state/territory: South Carolina;
SSBCI allocation amount applied for by state/territory: $17,990,415;
Amount of SSBCI funds approved by Treasury: $17,990,415;
Amount of SSBCI funds disbursed by Treasury: $5,936,837.
SSBCI-eligible state/territory: Virginia;
SSBCI allocation amount applied for by state/territory: $17,953,191;
Amount of SSBCI funds approved by Treasury: $17,953,191;
Amount of SSBCI funds disbursed by Treasury: $5,924,553.
SSBCI-eligible state/territory: Colorado;
SSBCI allocation amount applied for by state/territory: $17,233,489;
Amount of SSBCI funds approved by Treasury: $17,233,489;
Amount of SSBCI funds disbursed by Treasury: $5,687,051.
SSBCI-eligible state/territory: Oregon;
SSBCI allocation amount applied for by state/territory: $16,516,197;
Amount of SSBCI funds approved by Treasury: $16,516,197;
Amount of SSBCI funds disbursed by Treasury: $5,450,345.
SSBCI-eligible state/territory: Kentucky;
SSBCI allocation amount applied for by state/territory: $15,487,998;
Amount of SSBCI funds approved by Treasury: $15,487,998;
Amount of SSBCI funds disbursed by Treasury: $5,111,039.
SSBCI-eligible state/territory: Minnesota;
SSBCI allocation amount applied for by state/territory: $15,463,182;
Amount of SSBCI funds approved by Treasury: $15,463,182;
Amount of SSBCI funds disbursed by Treasury: $5,102,850.
SSBCI-eligible state/territory: Puerto Rico;
SSBCI allocation amount applied for by state/territory: $14,540,057;
Amount of SSBCI funds approved by Treasury: $14,540,057;
Amount of SSBCI funds disbursed by Treasury: $4,798,219.
SSBCI-eligible state/territory: Nevada;
SSBCI allocation amount applied for by state/territory: $13,803,176;
Amount of SSBCI funds approved by Treasury: $13,803,176;
Amount of SSBCI funds disbursed by Treasury: $4,555,048.
SSBCI-eligible state/territory: Connecticut;
SSBCI allocation amount applied for by state/territory: $13,301,126;
Amount of SSBCI funds approved by Treasury: $13,301,126;
Amount of SSBCI funds disbursed by Treasury: $4,389,372.
SSBCI-eligible state/territory: Arkansas;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $0.
SSBCI-eligible state/territory: Delaware;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: District of Columbia;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: Guam;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: Hawaii;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: Idaho;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: Iowa;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: Kansas;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: Louisiana;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: Maine;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: Mississippi;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: Montana;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: Nebraska;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: New Hampshire;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: New Mexico;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: Northern Mariana Islands;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $0;
Amount of SSBCI funds disbursed by Treasury: $0.
SSBCI-eligible state/territory: Oklahoma;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: Rhode Island;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: South Dakota;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: U.S. Virgin Islands;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: Utah;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: Vermont;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $4,345,556.
SSBCI-eligible state/territory: West Virginia;
SSBCI allocation amount applied for by state/territory: $13,168,350;
Amount of SSBCI funds approved by Treasury: $13,168,350;
Amount of SSBCI funds disbursed by Treasury: $0.
SSBCI-eligible state/territory: American Samoa[A];
SSBCI allocation amount applied for by state/territory: $10,418,500;
Amount of SSBCI funds approved by Treasury: $0;
Amount of SSBCI funds disbursed by Treasury: $0.
SSBCI-eligible state/territory: Alaska[B];
SSBCI allocation amount applied for by state/territory: data not
applicable;
Amount of SSBCI funds approved by Treasury: data not applicable;
Amount of SSBCI funds disbursed by Treasury: data not applicable.
SSBCI-eligible state/territory: North Dakota[C];
SSBCI allocation amount applied for by state/territory: data not
applicable;
Amount of SSBCI funds approved by Treasury: data not applicable;
Amount of SSBCI funds disbursed by Treasury: data not applicable.
SSBCI-eligible state/territory: Wyoming[C];
SSBCI allocation amount applied for by state/territory: data not
applicable;
Amount of SSBCI funds approved by Treasury: data not applicable;
Amount of SSBCI funds disbursed by Treasury: data not applicable.
SSBCI-eligible state/territory: Total;
SSBCI allocation amount applied for by state/territory: $1,420,895,102;
Amount of SSBCI funds approved by Treasury: $1,349,499,745;
Amount of SSBCI funds disbursed by Treasury: $424,127,983.
Sources: GAO survey and U.S. Treasury.
[A] Officials from American Samoa indicated that they initially
requested $10,380,008 in their SSBCI application, though the territory
was allocated the minimum SSBCI allocation amount of $13,168,350.
According to Treasury officials, American Samoa's request had
increased to $10,418,500 during the review process. Treasury officials
noted that they encouraged states to apply for the full amount of
their allocation for which they could reasonably demonstrate all of
the program's eligibility criteria. As of October 31, 2011, American
Samoa's application was still under review.
[B] Alaska initially submitted an application for its allocation of
$13,168,350 but withdrew it during the review process.
[C] North Dakota and Wyoming did not file a Notice of Intent to Apply
for their SSBCI allocation of $13,168,350 by the November 26, 2010,
deadline.
[End of table]
Appendix IV: Planned Uses of SSBCI Funds, by Location:
Table 2 below contains information on states and territories' plans
for the distribution of SSBCI funds among eligible program types,
provided by officials between August 15 and September 14, 2011.
Table 2: Planned Uses of SSBCI Funds, by Location and Program Type
(number of programs in parentheses):
State/territory: American Samoa;
Amount of SSBCI funds applied for: $10,380,008;
Capital access programs: $1,297,540 (1);
Collateral support programs: $2,906,373 (1);
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: $6,176,095 (1);
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: District of Columbia;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: $13,168,350 (1);
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Guam;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: $1,316,835 (1);
Collateral support programs: [Empty];
Loan participation programs: $4,608,923 (1);
Direct loan programs: [Empty];
Loan guarantee programs: $7,242,592 (1);
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Northern Mariana Islands;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: $6,168,350 (1);
Direct loan programs: [Empty];
Loan guarantee programs: $7,000,000 (1);
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Puerto Rico;
Amount of SSBCI funds applied for: $14,540,057;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: $12,540,057 (1);
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: $2,000,000 (1);
Other capital support programs: [Empty].
State/territory: U.S. Virgin Islands[A];
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: [Empty];
Collateral support programs: $3,738,477 (1);
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: $4,239,600 (1);
Venture capital programs: [Empty];
Other capital support programs: $5,190,275 (1).
State/territory: Alabama;
Amount of SSBCI funds applied for: $31,301,498;
Capital access programs: $11,301,498 (1);
Collateral support programs: [Empty];
Loan participation programs: $10,000,000 (4);
Direct loan programs: [Empty];
Loan guarantee programs: $10,000,000 (1);
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Arizona;
Amount of SSBCI funds applied for: $18,204,217;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: $18,204,217 (1);
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Arkansas[B];
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: $1,080,473 (1);
Collateral support programs: [Empty];
Loan participation programs: $5,080,474 (1);
Direct loan programs: [Empty];
Loan guarantee programs: $2,080,474 (1);
Venture capital programs: $4,926,929 (3);
Other capital support programs: [Empty].
State/territory: California[A];
Amount of SSBCI funds applied for: $168,623,821;
Capital access programs: $84,311,910 (1);
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: $84,311,910 (1);
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Colorado;
Amount of SSBCI funds applied for: $17,233,489;
Capital access programs: $2,000,000 (1);
Collateral support programs: $15,233,489 (1);
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Connecticut;
Amount of SSBCI funds applied for: $13,301,126;
Capital access programs: $13,301,126 (1);
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Delaware;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: $1,000,000 (1);
Collateral support programs: [Empty];
Loan participation programs: $12,168,350 (1);
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Florida;
Amount of SSBCI funds applied for: $97,662,349;
Capital access programs: $20,662,349 (1);
Collateral support programs: [Empty];
Loan participation programs: $9,500,000 (1);
Direct loan programs: $11,500,000 (2);
Loan guarantee programs: $12,500,000 (2);
Venture capital programs: $43,500,000 (1);
Other capital support programs: [Empty].
State/territory: Georgia;
Amount of SSBCI funds applied for: $47,808,507;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: $47,808,507 (2).
State/territory: Hawaii;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: $13,168,350 (1);
Other capital support programs: [Empty].
State/territory: Idaho;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: [Empty];
Collateral support programs: $13,168,350 (1);
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Illinois;
Amount of SSBCI funds applied for: $78,365,264;
Capital access programs: $6,365,264 (1);
Collateral support programs: $20,000,000 (1);
Loan participation programs: $17,000,000 (1);
Direct loan programs: $15,000,000 (1);
Loan guarantee programs: [Empty];
Venture capital programs: $20,000,000 (1);
Other capital support programs: [Empty].
State/territory: Indiana;
Amount of SSBCI funds applied for: $34,339,074;
Capital access programs: $1,500,000 (1);
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: $32,839,074 (1);
Other capital support programs: [Empty].
State/territory: Iowa;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: $5,000,000 (1);
Collateral support programs: [Empty];
Loan participation programs: $3,168,350 (1);
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: $5,000,000 (1);
Other capital support programs: [Empty].
State/territory: Kansas;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: $10,534,680 (1);
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: $2,633,670 (1);
Other capital support programs: [Empty].
State/territory: Kentucky;
Amount of SSBCI funds applied for: $15,487,998;
Capital access programs: $5,162,666 (1);
Collateral support programs: $5,162,666 (1);
Loan participation programs: $5,162,666 (1);
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Louisiana;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: $8,000,000 (1);
Venture capital programs: $5,168,350 (1);
Other capital support programs: [Empty].
State/territory: Maine;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: $10,168,350 (2);
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: $3,000,000 (1);
Other capital support programs: [Empty].
State/territory: Maryland;
Amount of SSBCI funds applied for: $23,025,709;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: $1,500,000 (1);
Loan guarantee programs: $15,025,709 (2);
Venture capital programs: $6,500,000 (1);
Other capital support programs: [Empty].
State/territory: Massachusetts;
Amount of SSBCI funds applied for: $22,032,072;
Capital access programs: $1,500,000 (1);
Collateral support programs: [Empty];
Loan participation programs: $20,532,072 (2);
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Michigan;
Amount of SSBCI funds applied for: $79,157,742;
Capital access programs: $4,200,000 (1);
Collateral support programs: $34,478,871 (1);
Loan participation programs: $34,478,871 (1);
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: $6,000,000 (1).
State/territory: Minnesota[C];
Amount of SSBCI funds applied for: $15,463,182;
Capital access programs: $3,112,779 (1);
Collateral support programs: [Empty];
Loan participation programs: $5,172,066 (1);
Direct loan programs: [Empty];
Loan guarantee programs: $6,065,558 (2);
Venture capital programs: $1,112,779 (1);
Other capital support programs: [Empty].
State/territory: Mississippi;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: $13,168,350 (1);
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Missouri;
Amount of SSBCI funds applied for: $26,930,294;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: $10,000,000 (1);
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: $16,930,294 (4);
Other capital support programs: [Empty].
State/territory: Montana;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: $13,168,350 (1);
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Nebraska;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: $13,168,350 (2);
Other capital support programs: [Empty].
State/territory: Nevada;
Amount of SSBCI funds applied for: $13,803,176;
Capital access programs: [Empty];
Collateral support programs: $13,303,176 (1);
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: $500,000 (1).
State/territory: New Hampshire[A];
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: $1,453,116 (1);
Collateral support programs: $2,594,851 (1);
Loan participation programs: [Empty];
Direct loan programs: $3,930,680 (1);
Loan guarantee programs: $3,113,821 (1);
Venture capital programs: $2,075,881 (1);
Other capital support programs: [Empty].
State/territory: New Jersey;
Amount of SSBCI funds applied for: $33,760,698;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: $13,500,000 (1);
Direct loan programs: $9,760,698 (5);
Loan guarantee programs: $5,500,000 (4);
Venture capital programs: $5,000,000 (1);
Other capital support programs: [Empty].
State/territory: New Mexico;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: $13,168,350 (1);
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: New York;
Amount of SSBCI funds applied for: $55,351,534;
Capital access programs: $18,994,204 (1);
Collateral support programs: $10,405,173 (1);
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: $25,952,157 (1);
Other capital support programs: [Empty].
State/territory: North Carolina;
Amount of SSBCI funds applied for: $46,061,319;
Capital access programs: $46,061,319 (1);
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Ohio;
Amount of SSBCI funds applied for: $55,138,373;
Capital access programs: $5,000,000 (1);
Collateral support programs: $35,138,373 (1);
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: $15,000,000 (1);
Other capital support programs: [Empty].
State/territory: Oklahoma;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: $13,168,350 (3);
Other capital support programs: [Empty].
State/territory: Oregon;
Amount of SSBCI funds applied for: $16,516,197;
Capital access programs: $4,016,197 (1);
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: $2,500,000 (1);
Loan guarantee programs: $10,000,000 (1);
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Pennsylvania;
Amount of SSBCI funds applied for: $29,241,232;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: $20,241,232 (3);
Direct loan programs: $9,000,000 (1);
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Rhode Island;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: $2,168,350 (1);
Loan guarantee programs: [Empty];
Venture capital programs: $11,000,000 (2);
Other capital support programs: [Empty].
State/territory: South Carolina;
Amount of SSBCI funds applied for: $17,990,415;
Capital access programs: $17,990,415 (1);
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: South Dakota;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: $13,168,350 (1).
State/territory: Tennessee;
Amount of SSBCI funds applied for: $29,672,070;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: $29,672,070 (1);
Other capital support programs: [Empty].
State/territory: Texas;
Amount of SSBCI funds applied for: $46,553,879;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: $10,553,879 (1);
Venture capital programs: $36,000,000 (1);
Other capital support programs: [Empty].
State/territory: Utah;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: [Empty];
Collateral support programs: [Empty];
Loan participation programs: $11,851,515 (1);
Direct loan programs: [Empty];
Loan guarantee programs: $1,316,835 (1);
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Vermont;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: $1,037,700 (1);
Collateral support programs: [Empty];
Loan participation programs: $12,130,650 (3);
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Virginia;
Amount of SSBCI funds applied for: $17,953,191;
Capital access programs: $2,953,191 (1);
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: $15,000,000 (1);
Loan guarantee programs: [Empty];
Venture capital programs: [Empty];
Other capital support programs: [Empty].
State/territory: Washington;
Amount of SSBCI funds applied for: $19,722,515;
Capital access programs: $6,000,000 (1);
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: [Empty];
Venture capital programs: $5,000,000 (1);
Other capital support programs: $8,722,515 (1).
State/territory: West Virginia;
Amount of SSBCI funds applied for: $13,168,350;
Capital access programs: [Empty];
Collateral support programs: $827,601 (1);
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: $551,734 (1);
Venture capital programs: $7,651,010 (1);
Other capital support programs:$ 4,138,005 (1).
State/territory: Wisconsin;
Amount of SSBCI funds applied for: $22,363,554;
Capital access programs: $3,000,000 (1);
Collateral support programs: [Empty];
Loan participation programs: [Empty];
Direct loan programs: [Empty];
Loan guarantee programs: $3,363,554 (1);
Venture capital programs: $16,000,000 (2);
Other capital support programs: [Empty].
State/territory: Total;
Capital access programs: $282,786,932 (27);
Collateral support programs: $156,957,400 (12);
Loan participation programs: $278,547,523 (32);
Direct loan programs: $70,359,728 (14);
Loan guarantee programs: $210,210,111 (25);
Venture capital programs: $336,467,264 (35);
Other capital support programs: $85,527,652 (8).
Source: GAO survey.
Note: North Dakota and Wyoming did not file a Notice of Intent to
apply for SSBCI funds. Alaska submitted an application to Treasury but
it was subsequently withdrawn during the review process.
[A] The information provided by the U.S. Virgin Islands, California,
and New Hampshire does not exactly equal each state's respective SSBCI
allocation amount due to rounding.
[B] Arkansas officials initially provided $482,840 of the state's
allocation amount separately as administrative expenses. Though this
amount has been evenly distributed across the 6 programs the state
plans to support in the table above, these numbers should only be
viewed as estimates as the actual funds provided to each of the
programs may be different to the extent that the distribution of
administrative costs are unequal across these programs.
[C] Minnesota officials initially provided $563,895 of the state's
allocation amount separately as administrative expenses. Though this
amount has been evenly distributed across the 5 programs the state
plans to support in the table above, these numbers should only be
viewed as estimates as the actual funds provided to each of the
programs may be different to the extent that the distribution of
administrative costs are unequal across these programs.
[End of table]
Appendix V: Comments from the Department of the Treasury:
Department Of The Treasury:
Washington, D.C. 20220:
November 28, 2011:
Ms. A. Nicole Clowers:
Director, Financial Markets and Community Investment:
Government Accountability Office:
441 G St., N.W.
Washington, D.C. 20548:
Dear Ms. Clowers:
Thank you for providing the Department of the Treasury ("Treasury")
the opportunity to review and comment on the Government Accountability
Office's ("GAO") draft report GA0-12-173 (the "Report") on the State
Small Business Credit Initiative ("SSBCI"). We appreciate the draft
Report's specific recognition that Treasury designed and implemented
this new program within a short timeframe and that SSBCI's application
review process was thorough and consistent.
GAO's sole recommendation is that Treasury should "consider key
attributes of successful performance measures as the program's
measures are developed and finalized." As noted in the draft Report,
Treasury is in the process of establishing performance measures for
the SSBCI program. We appreciate GAO's feedback on how to ensure these
measures are robust and meaningful, and will consider the key
attributes of successful performance measures as we work to finalize
SSBCI's measures. We further agree that performance measures will
assist Treasury in assessing the operation of the SSBCI program,
including the program's efforts to make credit available to small
businesses and manufacturers.
Thank you once again for the opportunity to review and comment on the
draft Report. Treasury values GAO's input on the SSBCI program and
looks forward to continued collaboration in the future.
Sincerely,
Signed by:
Don Graves, Jr.
Deputy Assistant Secretary:
Office of Small Business, Community Development, and Housing Policy:
[End of section]
Appendix VI: GAO Contact and Staff Acknowledgments:
GAO Contact:
A. Nicole Clowers, (202) 512-8678, clowersa@gao.gov:
Staff Acknowledgments:
In addition to the individual named above, Paul Schmidt, Assistant
Director; Pamela Davidson; Jill Lacey; Marc Molino; Patricia Moye;
Deena Richart; Christine San; Jennifer Schwartz; and Chad Williams
made key contributions to this report.
[End of section]
Footnotes:
[1] Small businesses are commonly defined as businesses with no more
than 500 employees for most manufacturing and mining industries and no
more than $7 million in average annual receipts for most
nonmanufacturing industries.
[2] Gallup, Wells Fargo Small Business Survey, Quarter 3, 2010
(Princeton, NJ).
[3] Board of Governors of the Federal Reserve System, National Summary
of the April 2010 Senior Loan Officer Opinion Survey on Bank Lending
Practices (Washington, D.C.: May 3, 2010) 2.
[4] "The State of Small Business Access to Capital and Credit: The
View from Secretary Geithner," 112th Cong. 1 (2011) (statement of
Timothy Geithner, Secretary of the United States Treasury).
[5] Small Business Jobs Act of 2010, Pub. L. No. 111-240, 124 Stat.
2504 (2010) (codified at 12 U.S.C. §§ 5701-5710).
[6] Throughout this report, the term "states" when used alone refers
to the 50 states as well as the District of Columbia, the Commonwealth
of Puerto Rico, the Commonwealth of Northern Mariana Islands, Guam,
American Samoa, and the United States Virgin Islands unless otherwise
noted.
[7] 12 U.S.C. § 5710(b).
[8] We did not survey municipalities in the two states--North Dakota
and Wyoming--that did not submit a Notice of Intent to Apply for SSBCI
funds.
[9] GAO, Standards for Internal Control for the Federal Government,
[hyperlink, http://www.gao.gov/products/GAO/AIMD-00-21.3.1]
(Washington, D.C.: November 1999).
[10] Treasury announced the 56 allocations on Oct. 8, 2010.
[11] 12 U.S.C. § 5703(d)(6).
[12] Coverage is determined by the states and lenders, not to exceed
80 percent of the loan value; a lender must have at least 20 percent
of its own capital at risk in each loan. In practice, collateral
support is rarely provided for more than 50 percent of the loan value.
[13] Treasury's SSBCI Policy Guidelines describe how states and
territories were to calculate a weighted-average, private-leverage
ratio when an applicant intended to apply for SSBCI funds to support
multiple lending programs.
[14] The program's reporting requirements are detailed in section 4.8
of the SSBCI allocation agreement. The obligations of participating
states and territories to perform and report on progress will expire
as outlined in the terms of the agreement.
[15] North Dakota and Wyoming did not submit a Notice of Intent to
Apply for SSBCI funds. According to a Wyoming official, the state did
not apply because the state's existing revolving loan fund has more
than $9 million in available funds, and the state's constitution
prohibits taking an equity position in a business. North Dakota
officials did not respond to our requests to discuss the state's
decision not to apply for funds. Alaska initially applied for its
maximum SSBCI allocation before the June 27, 2011, deadline but
subsequently withdrew its application. Alaska officials stated that
the withdrawal was due to statutory and appropriations issues within
their state that might have been resolved if more guidance had been
available earlier in the application process.
[16] Officials from American Samoa indicated that they initially
requested $10,380,008 in their SSBCI application, though the territory
was allocated the minimum SSBCI allocation amount of $13,168,350.
According to Treasury officials, American Samoa's request had
increased to $10,418,500 during the review process. Treasury officials
noted that they encouraged states to apply for the full amount of
their allocation for which they could reasonably demonstrate all of
the program's eligibility criteria. As of Oct. 31, 2011, American
Samoa's application was still under review.
[17] In responding to our survey, states described a variety of
different methodologies that they used to project the impact of their
respective SSBCI allocations.
[18] The CAP programs achieve a minimum of 14:1 leverage immediately,
since the maximum SSBCI subsidy per loan is 7 percent of the loan
amount.
[19] The scope of our review was limited to those applications that
had completed the application and review processes and been approved
by Treasury by June 30, 2011. Treasury reviewed and approved
subsequent applications after this date.
[20] Treasury officials noted that their policy deliberations
regarding the final process for approving subsequent disbursement
requests included but were not limited to clarifying the meaning of
the term "transferred." On November 9, 2011, Treasury officials stated
that they were updating the FAQ document on the SSBCI website to
include specific examples of state-level uses of funds that will
qualify as having been "expended, transferred, or obligated,"
according to their finalized and approved disbursement procedures.
[21] Treasury is working with its system contractor to have version
2.0 of this system--the annual reporting system--up and running before
the first annual reports are due in March 2012. Treasury officials
told us the quarterly reporting system became operational in October
2011.
[22] Office of Inspector General, Department of the Treasury, State
Small Business Credit Initiative: Treasury Needs to Strengthen State
Accountability for Use of Funds (Washington, D.C.: Aug. 5, 2011).
[23] Government Performance and Results Act of 1993, Pub. L. No. 103-
62, 107 Stat. 285 (1993).
[24] OMB, Program Assessment Rating Tool Guidance, No. 2007-02
(Washington, D.C.: Jan. 29, 2007).
[25] GAO, NextGen Air Transportation System: FAA's Metrics Can Be Used
to Report on Status of Individual Programs, but Not of Overall NextGen
Implementation or Outcomes, [hyperlink,
http://www.gao.gov/products/GAO-10-629] (Washington, D.C.: July 27,
2010).
[26] GAO, Tax Administration: IRS Needs to Further Refine Its Tax
Filing Season Performance Measures, [hyperlink,
http://www.gao.gov/products/GAO-03-143] (Washington, D.C.: Nov. 22,
2002).
[27] We did not survey municipalities in the two states--North Dakota
and Wyoming--that did not submit a Notice of Intent to Apply for SSBCI
funds.
[28] [hyperlink, http://www.gao.gov/products/GAO/AIMD-00-21.3.1].
[End of section]
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