Press Release | City of San Diego

San Diego Regional Revolving Loan Fund Launched
Regional Collaboration Brings New Resource for Community Revitalization and Small Business

SAN DIEGO – The City of San Diego is teaming up with cities in the South Bay to operate a $3 million loan fund that offers new resources to San Diego County’s small businesses and community revitalization efforts.

Led by the City of San Diego, the regional collaboration includes the cities of San Diego, National City, Imperial Beach and Chula Vista. The four cities will match a $1.5 million grant from the U.S. Economic Development Administration (EDA) to create the San Diego Regional Revolving Loan Fund.

In a joint statement, mayors of the four cities participating in the program stated, “We’re very pleased that by working together, we have been able to leverage funding that will help local businesses to invest in and help revitalize our communities.”

“This unprecedented collaboration of four local cities will help retain existing businesses and jobs while attracting new ones,” said City of San Diego Mayor Dick Murphy.

Targeted to economically distressed areas, the revolving loan fund will offer financial assistance to businesses in those areas that are making investments in new facilities or in property improvements. Businesses in these areas often have a difficult time securing funds from traditional lending sources.

The revolving Loan fund will typically be used to fill a “financing gap” in a project. The loan supplements private financing of new or rehabilitated buildings, fixed machinery and equipment, working capital and soft costs in targeted project areas. Loan sizes will generally be in the $150,000 to $500,000 range. Most loans will be direct loans fully amortized over three to seven years with fixed interest rates. Well-managed revolving loan funds will continue to generate leverage for many years.

Key objectives of the regional revolving loan fund include retaining existing businesses and jobs in San Diego County; attracting new businesses and jobs; increasing employment in areas of historically high unemployment levels, and diversifying the economy.

“We’re focusing on areas in San Diego County that have been misused or underserved,” Assistant Secretary of Commerce Dr. David Sampson said. “Creating jobs and economic opportunities is our first priority.

The San Diego Regional Revolving Loan Fund addresses the need for longer-term loans, loans with lower equity requirements, start-up capital, and for loans to firms without established banking relationships. Through careful screening of loan applicants and creative loan structuring, the program will reduce the reluctance of conventional lenders to meet the needs of these firms.

To be eligible, businesses must demonstrate that financing is not otherwise available. Other requirements specify that the business must be located in the census tract, create new employment opportunities and have firm financial commitments. Complying with all regulations and proving ability to repay the loan is mandatory.

The City of San Diego’s Community and Economic Development Department will administer the loans. For information about the revolving loan fund, contract Trish Hughes-Raber at (619) 533-7454 or phraber@sandiego.gov.

With an emphasis on the City’s urban core neighborhoods and low and moderate income residents, the Community and Economic Development Department strives to improve the quality of life and ensure a healthy economy in San Diego through job development, business development, neighborhood revitalization, public improvements, redevelopment, social services, and revenue enhancement.

Community & Economic Development