Crist looks to enact small business stimulus program
Published: Wednesday, January 7, 2009 at 9:48 a.m.
Last Modified: Wednesday, January 7, 2009 at 9:48 a.m.
TALLAHASSEE, Fla. — More than 30 businesses having trouble getting loans in today's tight credit market could get state help under a pilot program that Gov. Charlie Crist wants lawmakers to approve.
Crist and the head of the state's Office of Tourism, Trade and Economic Development outlined the idea for a group of economic development leaders at the governor's mansion Tuesday. The Republican governor asked for help persuading the GOP-controlled Legislature to pay for the $10 million program at a time when lawmakers are slashing the budget by $2.3 billion.
Some Democrats denounced the plan, saying it doesn't make sense to put millions into an unproven program while Republicans are trying to cut Visit Florida, the state's tourism promotion agency, by up to $12.9 million — about half of its total budget.
Visit Florida "is a proven commodity that generates revenue," said Rep. Joe Gibbons, a Hallandale Beach Democrat who sits on the House committee that oversees tourism spending. "I'm going to invest in something that works."
Sen. Mike Fasano, a Spring Hill Republican who chairs the Senate panel that oversees economic development spending, defended the loan plan.
"Why not help the small businesses in our community that want to expand and are looking to hire people?" Fasano said. "Visit Florida doesn't create jobs."
Businesses that show growth potential and employ between 10 and 99 people would be eligible for loans of up to $250,000 at a 2 percent interest rate if they guarantee they will create jobs.
At least 34 businesses could be helped by $8.5 million in loans. Another $1.5 million would be used to provide technical assistance to businesses seeking to grow. Crist said he wanted more money for the program, acknowledging that $8.5 million can only be spread so far.
"We'd love be able to do the $100 million for this program, but that just isn't presented to us," Crist said. "So we have to live within our means, yet still be creative and try to do things that give small businesses in particular a greater opportunity to not merely survive but to try to thrive."
The goal is to start small and convince lawmakers to increase the loan program in the future, said Dale Brill, who heads the state economic development office.
"Test now, prove the concept and then you know it's something that works," Brill said.
Businesses are struggling to expand because banks aren't lending much money right now, Brill said. The program would target high-performance companies that would promise to create a certain number of jobs if they receive the loan. Those that fall short of the goal would pay penalties.
"We need to give them money to prove that if we could just unlock this capital market, that that's one of the things that's really holding back growth in this state and it will create jobs for Floridians," Brill said.
Crist and Brill made their presentation to members of economic development groups from around the state. The idea was well received.
Reader comments posted to this article may be published in our print edition. All rights reserved. This copyrighted material may not be re-published without permission. Links are encouraged.
Comments are currently unavailable on this article