ASG to submit new application for Small Business Credit program
Commerce Department director Keniseli Lafaele confirmed Wednesday that American Samoa will be submitting next week to the U.S. Treasury Department, the territory’s new State Small Business Credit Initiative (SSBCI) application and plan.
“Hopefully we'll get the [U.S.] Treasury's stamp of approval shortly after that,” he told Samoa News.
The territory’s new application and plan followed a meeting that Lafaele held Oct. 31 in Washington D.C. with U.S. Treasury official David Rixter, who is the Outreach Manager for the SSBCI program.
U.S. Treasury Department had approved $10.4 million for American Samoa under the SSBCI, which was created under the federal Small Business Jobs Act of 2010 in response to concerns that small businesses have been unable to access capital that would allow them to create jobs.
The program supplies pledged cash collateral accounts to lending institutions to enhance collateral coverage of individual loans, but officials of the two banks testified in the Fono last year of their reluctance to participate in the program, due to among other things, their concerns that the SSBCI provides only up to 50% of the cash collateral.
Officials of the previous administration told lawmakers that the government was looking at off-island banks to participate in this program since the two local banks were reluctant.
According to the federal government, the SSBCI is a one-time program of limited duration and the authorities and duties of the Secretary of the Treasury is to implement and administer the program that terminates on September 27, 2017.
Moreover, the obligations of participating states and territories to perform and report on progress will expire as outlined in the terms of the Allocation Agreement on March 31, 2017.