Where’s Our Stimulus? Did it create jobs for Shelby County and Memphis?
The U.S. government has pumped billions of dollars into the economy to stabilize the banking system and keep money flowing, but not much is trickling down to small-business owners. It can and does get a little frustrating when we have seen the big banks, the corporations and the automakers that have made horrible, horrible choices get bailed out, while those of us who work 12 to 14 hours a day, six to seven days a week, we can’t get any help. A survey released by the National Federation of Independent Business Research Foundation revealed that only 40 percent of small-business owners who attempted to borrow money last year had all of their credit needs met. That compares to a 90 percent success rate in the mid-2000s.
As part of the 2009 American Recovery and Reinvestment Act (signed Feb 17, 2009), the United States Government has allocated SBA backed funds for viable small businesses in the United States. Business must have qualifying business loans and must be experiencing immediate financial hardship. Qualifying recipients of the America’s Recovery Capital (ARC) Loan Program may receive up to $35,000 in short-term relief. Each small business is limited to one ARC loan.
ARC loans can be used to make payments of principal and interest, in full or in part, on one or more existing, qualifying small business loans for up to six months. ARC loans are intended to provide immediate capital to small businesses to make payments (principal and interest) on existing debt and thus allow business owners to sustain and retain jobs. ARC loans are interest-free to the borrower and carry a 100% guarantee from the SBA. Loan proceeds are provided over a six-month period. Repayment of the ARC loan principal is deferred for 12 months after the last disbursement (18 months from the first disbursement), followed by a repayment period of five years.
Good candidates for ARC loans are small businesses that can show a profitable past, but are currently struggling to make loan payments or are just beginning to miss loan payments due to financial hardship.
ARC loans are made by participating commercial SBA lenders. The SBA will pay these banks a monthly interest rate throughout the term of the loan. ARC loans will be offered by some SBA lenders for as long as funding is available or until September 30, 2010, whichever comes first.
When President Obama signed the 840 billion dollar American recovery and reinvestment act into law in 2009 Memphis received a total of nearly 640 million dollars.
“Community health centers, monies went to the Memphis Health Center, and the Christ Community Health Center, we’ve had money go to all kinds of women’s shelters, any federal program has been effected,” says 9th District Representative Steve Cohen. “The stimulus has helped keep us from a deep recession and get us to where are coming out of it now.”
Critics say hundreds of millions of our tax dollars were spent and unemployment in the Bluff City dipped only slightly from a staggering 12-percent in January of 2010 to 10-percent in May of this year.
Conservative talk show host Andrew Clarksenior calls the stimulus package a bust, “It has brought needed funds to needed projects, but it has not been the panacea that the good congressman would make you think…by and large, the majority of that money was wasted, and misapplied.”
Clarksenior points a few projects that were well meaning, but questions if they deserved funding. The Memphis Orchestral Society, the Center for Southern Folklore and the Beale Street Caravan received a total of a $125-thousand dollars to keep jobs that might have been lost because of the recession. Nearly a half million dollars went to the University of Memphis Math Department to create better traffic patterns.
“It was a big lie. Not just here but all over the country. The “pork-u-lus bill, however you want to call it was terribly misspent,” says Clarksenior.
In Memphis, the stimulus money was intended to create jobs, but millions was spent to help a social network already under stress. More than 10 Million dollars used on housing for the poor and people diagnosed with AIDS/HIV. Nearly 4-million dollars spent to improve emergency shelters in case of an emergency, almost 108 million dollars on public education in Shelby and Memphis even though teachers were laid off. All that money spent and exactly how many jobs were created? It had been estimated 68-hundred would be created, no one knows for sure. The federal, state and local governments can’t give a total. When will we wake up as a community?