On Mar. 2, SBA issued rules on the community advantage pilot.
The Community Advantage (CA) Pilot Program is a pilot program to increase Small Business Administration-guaranteed loans to small businesses in underserved areas.
Comment solicited from interested members of public on aspects of CA Pilot Program.
CA Pilot Program Overview
Revised requirements for refinancing non-SBA guaranteed, same institution debt in certain circumstances; number loans CA lender must make before it can process loans.
Advice on expiration and process for renewal CA Lenders' Loan Guaranty Agreements.
Revisions Background
Sep. 2018 Notice extended program to Sep. 30, 2022, moratorium on new Community Advantage Lenders, revised refinancing non-SBA guaranteed, same institution debt,
Sep. 2018 Notice additionally revised other program requirements; SBA is issuing the current Notice to further revise Community Advantage Pilot Program requirements.
Revisions Overview
New revisions let CA Lender pay off certain interim loans with an SBA-guaranteed CA loan when beneficial to the small business applicant under certain circumstances.
Lender eligible for delegated authority now may not process loans using that authority until closes and makes an initial disbursement on at least 10 non-delegated CA loans.
Office of Credit Risk Management will review each CA Lender prior to Mar. 31, 2020.
OCRM review assess CA Lender's compliance with SBA Loan Program requirements.
SBA will accept new applications from qualified eligible entities to replace CA Lenders that voluntarily withdraw from the program or are otherwise removed from program.
Consultation
Changes effective Mar. 2, 2020; pilot program will remain in effect until Sep. 30, 2022.
Comments as to the SBA Pilot Program must be received on or before Apr. 1, 2020.
Jul. 15, 2020 Temporary Change
On Jul. 15, 2020, SBA published temporary changes to community advantage pilot.
Developed a new, temporary community advantage loan product, CA recovery loans.
Loans provide technical, financial assistance to small businesses in underserved areas.
Aid retooling business models for COVID-19 environment, building financial resilience.
Changes to CA pilot program effective Jul. 15, 2020; CA recovery loans can be approved through Sep. 27, 2020; must be fully disbursed no later than Oct. 1, 2020.
Comments on temporary change requested; must be received by Aug. 14, 2020.
Mar. 2022 SBA CA Program Expansion
On Mar. 30, 2022, SBA announced expansion to Community Advantage (CA) program.
Lifts four-year lender moratorium and extends pilot from Sep. 2022 to Sep. 30, 2024.
Enhances revolver or line of credit and eases underwriting and collateral requirements.
In addition, broadens number of lenders eligible for SBA 7(a) loans up to $350,000.
Finally, reforms will remove prohibitive policy that excludes those with criminal history.
Apr. 2022 Fed Reg Program Expansion
On Apr. 1, 2022, SBA announced expansion of CA program, in the federal register.
Changes identified in notice take effect Apr. 1, 2022; SBA will begin accepting new CA applications May 2, 2022; CA Pilot Program will remain in effect until Sep. 30, 2024.
