What The Stimulus Package Can Do For Your Business

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SBA Business plans

The $787 billion economic recovery package enacted by the Obama administration will deliver needed financial aid and tax relief to a lot of businesses. The key is to keep an eye for the specific programs and provisions that will help your company. For example:

• There are no grants. Money will come via contracts and tax credits. Not grants.
• What the recovery package will offer is a mix of tax breaks, government contracting opportunities, SBA-underwritten loan programs and more that could benefit all types of enterprises.
• The tax benefits include allowing business losses to be carried back five years instead of just three years, providing greater potential tax savings. There is also a tax credit for hiring disadvantaged workers or U.S. military veterans.
• A lot of opportunities are coming up in government contracting. All sorts of businesses may supply goods and services to government recovery programs, but especially those in construction, data management and systems engineering might benefit.
• There are a number of changes expected shortly in SBA-guaranteed loan programs.
• In order to encourage banks to make more such loans, the SBA will back 100 percent of many types of loans, those which currently are guaranteed only up to 85 percent.
• Also, SBA loan fees will be greatly reduced or simply dropped.
• Still in the works, too, is a business stabilization loan, designed to bring relief to businesses with short-term cash-flow problems. For example, if a company is falling behind on an existing loan, this program would guarantee 100 percent of a conventional bank loan up to $35,000 and allow borrowers to defer any payments for up to a year.

WHAT BUSINESSES SHOULD DO NOW:

Prospective contractors should visit www.stimuluswatch.org/project/ - a nongovernmental Web site that lists so-called "shovel-ready" projects, compiled by the U.S. Conference of Mayors last year in anticipation of a federal stimulus package. The site is searchable by keyword, type of program or location and invites visitors to give a thumbs up or thumbs down on each project.

Businesses should also enroll at the federal Central Contractor Registration - www.ccr.gov - a primary database used by federal agencies to find and verify contractors.

And, naturally, keep in touch with local government representatives to find out what is coming down the pike.