Florida’s Black Business Loan Program Needs Reforms

Black-owned businesses along the Treasure Coast are doing quite well.

This is at least a somewhat misleading conclusion that could be drawn from the research published by the Brookings Institutiona think tank that studies a variety of national economic and political issues.

In an article published on December 31, 2020two Brookings researchers said census data indicates that Black-owned businesses in the Port St. Lucie metro area (which includes St. Lucie and Martin counties) have higher average salaries ($49,371 ) than any other metropolitan area in the country.

By comparison, the Las Vegas metro area lags far behind with an average salary of $45,059 for employees of black-owned businesses.

The same article indicates that almost a quarter of Black-owned businesses in the Port St. Lucie metro area (23%) have been in operation for 16 years or more.

This all sounds like great news, except the researchers admitted their data could be skewed because there are relatively few (158) black-owned businesses operating here. which is more than four times less than the total number in the Las Vegas metro area.

This raises a question: would more black-owned businesses choose to locate along the Treasure Coast, which could raise average wages and provide an overall boost to the local economy, if they had easier access to the funds they need to operate?

Blake Fontenay:Treasure Coast region needs its own administrator for black business loans

Blake Fontenay:State Loan Scheme for Black-Owned Businesses Is Just a Front

Talbert and Maria Chambers, owners of CNC Soul Food and Jamaican restaurants, of Port St. Lucie, serve customers Thursday, Feb. 10, 2022, in the Lincoln Park neighborhood of Fort Pierce.  The couple, together for nearly 20 years and both from Jamaica, worked hard to open their restaurant in January and could use funds to improve the interior and exterior and increase marketing.  The state offers financing through the Black Business Loan Program, but entrepreneurs across the state have struggled to access the money.

The states Black Business Loan Program should be able to help Black-owned businesses here and elsewhere in Florida. The program was created in 1984 to provide a source of capital for businesses that might have difficulty obtaining it from other sources.

It is important to emphasize that the program provides loans and not grants.

Kathleen Murphy, Executive Director of the Miami Bayside Foundation, says TCPalm columnist Blake Fontenay his organization has been an administrator of the program since April 2019, distributing about 40 loans totaling $2.4 million.

The loans, which have no processing fees, can vary between $5,000 and $150,000. Murphy said interest rates are 6% and loans must be repaid within five years.

Obviously, since the loans are expected to be repaid, with interest, this is not a gift from the government.

It’s one of those tools meant to help black entrepreneurs pull themselves up by their proverbial boots, which conservatives and liberals alike often say they want to encourage.

Don’t feel bad if you don’t know much (or anything) about this program, though. the Miami Bayside Foundation only issues loans for the program in its three-county service area, which does not include the Treasure Coast.

the Florida A&M University Federal Credit Unionthe only statewide administrator of the program, had been essentially inactive for several months during a contract dispute with the Florida Department of Economic Opportunity.

Talbert and Maria Chambers, owners of CNC Soul Food and Jamaican restaurants, of Port St. Lucie, serve customers Thursday, Feb. 10, 2022, in the Lincoln Park neighborhood of Fort Pierce.  The couple, together for nearly 20 years and both from Jamaica, worked hard to open their restaurant in January and could use funds to improve the interior and exterior and increase marketing.  The state offers financing through the Black Business Loan Program, but entrepreneurs across the state have struggled to access the money.

While the dispute has been resolvedit’s fair to wonder if one organization, or even two or three, has the resources to adequately market the program to businesses across the state that could benefit from it.

Chauncelor Howell, President of the Treasure Coast Black Chamber of Commercesaid he was not aware of any local businesses that had taken advantage of the scheme, which should be a huge red flag.

According to a recent report by the Department of Economic Opportunity, the amount loaned under the program exceeded the Legislative Assembly’s $2.2 million annual allocation only once in the past seven years.

It is simply amazing that no other company has been eligible and interested in receiving loan funds in these other six years.

State lawmakers should seek ways to reform this program, beginning with efforts to recruit more qualified financial institutions to serve as administrators over a wider geographic area. This step alone could make the program much more useful.

Once more trustees are installed and making loans, it would be worth considering whether the $2.2 million annual allocation is sufficient to cover loan needs as well as marketing expenses. That small amount equates to a rounding error in the state’s $112 billion budget.

While the dollar amounts may seem small, the potential impact they can have on Black-owned businesses and the people who work for them is enormous.

Let’s hope this worthwhile program, funded with taxpayers’ money, can reach its full potential.

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