HILLSBORO, Mo. - Agriculture Secretary Tom Vilsack and U.S. Small Business (SBA) Administrator Karen G. Mills today announced that the two agencies have signed an agreement to encourage sustainable growth and development of rural small businesses. The announcement was made during the National Summit of Rural America, which gathered agricultural leaders, farmers, ranchers, community leaders, and residents of rural communities to share their vision and ideas that can help rebuild and revitalize rural America.
"The Obama Administration strongly supports efforts to develop new and existing businesses and this new partnership will help increase access to capital in rural communities which can spur business growth and job creation," Vilsack said. "USDA has many business programs designed to promote small business development, including direct and guaranteed loans and grant assistance and we look forward to partnering with the SBA in our business development and support efforts."
The agreement between the SBA and USDA is designed to reach out to people and places in rural areas and small communities with underserved financial needs. Prospective small businesses owned by minorities, women and veterans also are expected to benefit from this joint effort to encourage sustainable growth and development. USDA Rural Development's Rural Business Service will provide loan guarantees, loans and grants; the Small Business Administration will provide loan guarantees.
The MOU will remain in effect for three years. Under the agreement, USDA Rural Development and SBA will use their respective resources to provide small businesses in rural areas with loan guarantees and technical assistance to help build diverse and sustainable economies, reverse population decline, create and sustain jobs, and improve quality of life. The agreement is expected to:
- Improve opportunities for small businesses to start and grow;
- Improve coordination in the delivery and development of programs; and
- Increase the number of small business loans guaranteed by USDA and SBA.
"Small businesses and entrepreneurs are a key source of job creation and the foundation of local economies in rural communities across the country. Both SBA and USDA are committed
to bring our collective expertise, financial resources and experience to help start, grow and sustain rural businesses and promote entrepreneurship," Mills said. "This partnership represents the Obama Administration's ongoing commitment to working across our various agencies to increase economic opportunity for rural citizens."
Key goals of this partnership include strengthening marketing and outreach by enabling each Agency's field offices to advise potential small business borrowers of the other Agency's credit programs that may support all or a portion of the small business' financing needs. USDA Rural Development and SBA field offices will exchange promotional and reference materials, including brochures and training schedules, and will distribute the other Agency's information to its field network and its potential applicants when appropriate.
USDA and SBA will also encourage their networks of resource partners to refer rural businesses to the other Agency's resources, where appropriate. Rural Development's network includes National and State Rural Partnership Councils, State and sub-State Offices, and Appropriate Technology Transfer to Rural Areas. SBA's network includes Small Business Development Centers, SCORE Chapters, U.S. Export Assistance Centers, Veteran Business Outreach Centers and Women's Business Centers. By mutual agreement, USDA and SBA may identify pairings of State and district offices to explore mutual best practices available to serve clients.
The Small Business Administration works to assist and protect the interests of small business. SBA guarantees loans and provides business development assistance to small businesses. It administers its programs through district offices throughout the United States and provides additional services through its network of resource partners: the Small Business Development Centers (SBDC), SCORE, U.S. Export Assistance Centers (USEAC), Women's Business Centers (WBC), and Veterans Business Outreach Centers (VBOC).
USDA, through its Rural Development mission area, administers and manages more than 40 housing, business and community infrastructure and facility programs through a national network of 6,100 employees located in the nation's capital and in 500 national, state and local offices. These programs are designed to improve the economic stability of rural communities, businesses, residents, farmers and ranchers and improve the quality of life in rural America. Rural Development has an existing portfolio of more than $134 billion in loans and loan guarantees.
