Bill Overview
Title: SSBCI Improvement Act
Description: This bill modifies how funds are transferred to (and recouped from) states under the State Small Business Credit Initiative. For example, if a state's allocated amount is less than or equal to $1,000,000 the Department of the Treasury must provide the full amount in a single transfer.
Sponsors: Sen. Klobuchar, Amy [D-MN]
Target Audience
Population: Small business owners and their employees
Estimated Size: 30000000
- The SSBCI Improvement Act impacts the State Small Business Credit Initiative, which is directly linked to providing credit support to small businesses.
- State Small Business Credit Initiative (SSBCI) funds are often used to support small businesses through loans, credit guarantees, and other financial products.
- The primary beneficiaries of these funds are small business owners and their employees, but a successful small business also benefits the local community.
- Since it's a state-level credit initiative, it will affect small business owners in all states of the US where the SSBCI is operational.
Reasoning
- The SSBCI Improvement Act primarily benefits small business owners who are seeking financial support from the state's initiatives. Thus, individuals in this category are the primary target population.
- Assuming an average business owner employs 1-10 people, the policy could indirectly affect employees by stabilizing the business and general local economy.
- Not all small business owners will be affected equally; those in states where the funding is significantly enhanced will likely experience higher impacts.
- Given the budget constraints, only a subset of small businesses would potentially benefit; realistically, this impact might only reach a few thousand businesses directly across states.
- Balancing costs includes focusing on diverse business types and locations, assessing potential growth opportunities, and supporting businesses that would benefit most from credit initiatives.
Simulated Interviews
Small business owner (Des Moines, Iowa)
Age: 52 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 7/20
Statement of Opinion:
- I believe this policy could be beneficial, especially during economically hard times. Access to funds could help us expand, hire more staff, and deal with unexpected expenses.
- State funds have been crucial during the pandemic, and any improvement is welcome.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 5 |
| Year 10 | 8 | 5 |
| Year 20 | 7 | 5 |
Technology startup founder (Austin, Texas)
Age: 37 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 10.0 years
Commonness: 5/20
Statement of Opinion:
- As a startup, access to funds can transform our operation. If the state can facilitate better access, that would be incredible.
- Though our state supports tech innovation, easier credit could drive faster growth.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 9 | 8 |
| Year 2 | 9 | 8 |
| Year 3 | 9 | 8 |
| Year 5 | 10 | 8 |
| Year 10 | 10 | 8 |
| Year 20 | 10 | 8 |
Owner of a manufacturing company (Buffalo, New York)
Age: 45 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 8/20
Statement of Opinion:
- The present funds allocation is quite bureaucratic. Any process improvement would save time and potentially money.
- Our company could use loans to modernize equipment.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 7 | 4 |
| Year 10 | 7 | 4 |
| Year 20 | 6 | 4 |
Freelancer (Seattle, Washington)
Age: 29 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 3.0 years
Commonness: 3/20
Statement of Opinion:
- I don't directly receive state business funds, but if my clients get more business, they'll hire me more often.
- It indirectly supports me as an independent contractor.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 5 |
| Year 20 | 6 | 5 |
Construction company owner (Birmingham, Alabama)
Age: 42 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 4.0 years
Commonness: 6/20
Statement of Opinion:
- Construction often needs cash flow for materials and labor before client payment. Extra state support eases operations.
- More funds could let us bid on bigger contracts.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 7 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 7 | 4 |
| Year 10 | 6 | 4 |
| Year 20 | 6 | 4 |
Bakery owner (San Francisco, California)
Age: 34 | Gender: female
Wellbeing Before Policy: 4
Duration of Impact: 3.0 years
Commonness: 9/20
Statement of Opinion:
- State initiatives could provide relief, helping manage seasonal dips in sales.
- Better funding channels allow us potential storefront expansion.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 4 |
| Year 2 | 6 | 4 |
| Year 3 | 6 | 4 |
| Year 5 | 5 | 4 |
| Year 10 | 5 | 3 |
| Year 20 | 5 | 3 |
Retired (Detroit, Michigan)
Age: 60 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 1.0 years
Commonness: 4/20
Statement of Opinion:
- As a retiree, my investment's performance directly impacts my income.
- If businesses perform better, dividends could increase.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 6 | 5 |
Owner of a cleaning service (Raleigh, North Carolina)
Age: 25 | Gender: other
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 5/20
Statement of Opinion:
- Getting easier access to loans helps us pursue bigger contracts without worrying about cash flow.
- Smoother operation would support further expansion plans.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 8 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 5 |
| Year 10 | 8 | 5 |
| Year 20 | 7 | 5 |
Non-profit director (Boston, Massachusetts)
Age: 50 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 3.0 years
Commonness: 5/20
Statement of Opinion:
- Our non-profit could partner with more businesses if they receive state support; it’s a crucial part of our mission.
- Better credit access aligns with our financial education programs offered to entrepreneurs.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 5 | 4 |
| Year 20 | 5 | 4 |
Accountant (Phoenix, Arizona)
Age: 59 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 2.0 years
Commonness: 6/20
Statement of Opinion:
- Though I personally won't receive these funds, my clients may be able to expand, meaning more business for me.
- Increased flow from my clients could improve my business revenue stability.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 6 | 5 |
| Year 20 | 6 | 5 |
Cost Estimates
Year 1: $6000000 (Low: $4000000, High: $8000000)
Year 2: $5500000 (Low: $3500000, High: $7500000)
Year 3: $5000000 (Low: $3000000, High: $7000000)
Year 5: $4000000 (Low: $2000000, High: $6000000)
Year 10: $3000000 (Low: $1000000, High: $5000000)
Year 100: $1000000 (Low: $500000, High: $1500000)
Key Considerations
- The policy assumes that Treasury's front-loading of funds is more efficient than current staggered approaches.
- Long-term impacts on small businesses are contingent upon states' use of the provided funds.
- There may be variations in impact depending on the states' existing economic environments and their administrative capacities.