The owner of Laurabelle’s Cupcakery in Corning used a loan backed by the U.S. Small Business Administration (SBA) to expand her startup business in a “historic, visible” storefront. Tarrah Seaver, owner of Laurabelle’s Cupcakery, used a $25,000 SBA microloan from REDEC/RRC, one of the Southern Tier’s SBA lending partners, the agency said in a news […]
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The owner of Laurabelle’s Cupcakery in Corning used a loan backed by the U.S. Small Business Administration (SBA) to expand her startup business in a “historic, visible” storefront.
Tarrah Seaver, owner of Laurabelle’s Cupcakery, used a $25,000 SBA microloan from REDEC/RRC, one of the Southern Tier’s SBA lending partners, the agency said in a news release.
REDEC/RRC is the Southern Tier’s primary revolving loan fund, providing financial and technical assistance for start-up and expanding businesses located in Chemung, Schuyler, Steuben, and Tioga counties, per the website of the Corning Area Chamber of Commerce. RRC is short for REDEC Relending Corporation, the website says.
Seaver — who named her business after her grandmother — first opened her business in a small storefront off East Market Street in downtown Corning, then moved across the street to her current location, a former shoe store. The space has “shelf-lined walls [that] make a great display space for her collection of vintage and modern cake stands,” the SBA noted.
But Seaver needed additional equipment, including ventilation equipment for her retail location.
“The SBA has delivered on its promise to upstate’s entrepreneurs by working together with our lending and resource partners,” Bernard J. Paprocki, director of the SBA’s Upstate New York district, contended in a statement. “We are empowering entrepreneurs at every stage of their business lifecycle, including recovery. Backed by the strength and stability of the federal government, our team will continue to connect small businesses like Tarrah’s with the financing they need to fuel the economy.”
The SBA cited Seaver’s loan as it announced summary loan data of fiscal year 2020, which includes the financial assistance provided through traditional loan-program lending as well as additional aid provided through the CARES Act, per an Oct. 29 news release.
Fiscal year 2020 (FY20) spanned Oct. 1, 2019 through Sept. 30, 2020.
Loans guaranteed through traditional SBA lending programs exceeded $28 billion nationally, the agency said.
In FY20, SBA’s flagship 7(a) loan program made about 42,000 7(a) loans totaling $22.55 billion. The 504-loan program had another year of increased performance, with more than 7,000 loans made for a total dollar amount of more than $5.8 billion.
In September, SBA approved more than $1 billion in 504-program loans, which is a “record for monthly volume,” the agency noted.
The microloan program, which specifically helps businesses in underserved communities, had a “second straight record year performance” with nearly $85 million going to over 5,800 small businesses.
Thirty-four percent of microloans made in FY20 went to Black-owned small businesses, the SBA said.
Lenders reported that minority business owners received $7.5 billion in combined 7(a) and 504-program lending, or 27 percent of the agency’s loan portfolio.
Further reported data shows SBA’s 7(a) lending to women-owned businesses was nearly $2.7 billion in FY20 while lending from the 504-loan program to women-owned businesses topped $522 million. Loans to veterans also totaled nearly $835 million for the 7(a) and 504 programs.
CARES Act impact
Small-business loan volume went to a dramatically higher level with enactment of the CARES Act to deal with the devastating effects the pandemic had on small businesses.
In the recently closed fiscal year, the Paycheck Protection Program (PPP) provided an additional 5.2 million potentially forgivable loans worth more than $525 billion nationally. The SBA Economic Injury Disaster Loan (EIDL) Program, which is administered by the agency’s Office of Disaster Assistance, added another 3.6 million small-business loans valued at $191 billion. It also processed an additional 5.7 million EIDL advances worth $20 billion.
As of the last disaster-assistance report, New York state saw more than 300,000 EIDL loans approved for over $17.3 billion.
SBA listed what it called “highlights” from the PPP effort that included 27 percent of the PPP loan dollars going to low-and moderate-income communities which is “in proportion to the percentage of population in these areas.”
Also, more than $133 billion, or 25 percent, of PPP loans were approved for small businesses in historically underutilized business zones, or what are called HUBZones.
In addition, more than $80 billion, or 15 percent, of total PPP dollars were approved to small businesses in rural communities.