CHARLESTON, (WV) – Gov. Jim Justice announced that West Virginia will receive up to $72.1 million from the U.S. Department of the Treasury under a new round of the State Small Business Credit Initiative (SSBCI) to increase access to capital and promote entrepreneurship, especially in traditionally underserved communities as they emerge from the pandemic.
“Since the day I walked in the door as Governor, I’ve tried to make West Virginia the best state in the nation to chase the American Dream – a place where success and prosperity are right at your fingertips. This is an astounding amount of funding that is going to allow so many of our business owners to achieve that dream,” Gov. Justice said. “It will also help people in our state who maybe have a great idea, but haven’t had the capital to turn that idea into a business. By providing a boost to those kinds of people, we will be able to continue our efforts to diversify our economy and move our entire state forward in new and exciting ways. I could not be more thrilled.”
The American Rescue Plan reauthorized and expanded SSBCI, which was originally established in 2010. The West Virginia Capital Access Program (WVCAP), which manages SSBCI funding under the West Virginia Jobs Investment Trust (WVJIT), has an exceptional track record in increasing access to capital for traditionally underserved small businesses and entrepreneurs across West Virginia. This additional SSBCI funding is expected to catalyze up to $10 of private investment for every $1 of SSBCI capital funding, amplifying the effects of this funding and providing small business owners with the resources they need to sustainably grow and thrive.
The WVJIT submitted a plan to the Treasury for how they will use this SSBCI allocation to provide funding to small businesses, including through venture capital programs, collateral support programs, and subordinated debt programs. West Virginia’s plan is one of only five states so far to receive Treasury approval.
West Virginia will operate a seed capital co-investment fund with more than half of its allocation, increasing small businesses’ access to venture capital in a state with no resident venture capital firms and annual average venture capital investment well below the per capita national average. The fund will focus on expanding access to capital for underserved communities by providing equity investments matched with private equity from angel investors or venture capital funds. Statewide and regional nonprofits, as well as Community Development Financial Institutions (CDFIs), will partner with community banks and CDFIs to use the remaining balance of the funds for two loan programs. These loan programs will serve West Virginia businesses needing business loans.
An announcement will be made when funds are available later this year.
Since its inception in 2010 with just $13.2 million in SSBCI funding, the WVCAP has supported 53 loans and investments and generated almost $91 million in private match, with over 1,100 jobs created or retained.
“I’ve said many times that I’m not a politician, I’m a business guy. I’ve been a business guy my whole life. I understand just how much of an impact our small businesses have in our state’s economy. They are our foundation,” Gov. Justice said. “As Governor, I’ve tried with all in me to make West Virginia the very best place to own or operate a business, and people are finally taking notice. Through our efforts, more and more businesses have been popping up all over the place and they’re bringing all kinds of goodness along with them. Every month, we’re setting record after record for job growth and our state’s revenue surpluses have never been higher. Our state is truly on the rocket ship ride that I promised, and this announcement will allow us to step on the gas even further.”
“The West Virginia Economic Development Authority is excited to be working directly with the West Virginia Jobs Investment Trust and other program participants around the State to provide over $70 million dollars in alternative financing opportunities for our small business communities and entrepreneurs through the West Virginia Capital Access Program administered by WVJIT,” said Kris Warner, Executive Director of the West Virginia Economic Development Authority. “Under Governor Justice’s leadership, this funding, along with the legislature’s appropriation of $600 million dollars to WVEDA puts the State of West Virginia in an unprecedented financial position to help grow and diversify our State’s economy.”
“This announcement from the U.S. Treasury regarding the SSBCI funding for the State of West Virginia is the culmination of months of work by our team, the folks in the Governor’s Office, members of the Department of Commerce and Department of Economic Development, the WVCAP Advisory Committee, and the stakeholders in our entrepreneurial ecosystem. Because of this collective effort, West Virginia was one of the first states to be approved by the U.S. Treasury,” said Andy Zulauf, Executive Director of the West Virginia Jobs Investment Trust. “We have the highest expectations to achieve positive results with this new SSBCI funding. It is truly a transformative opportunity for our great state.”
The West Virginia Jobs Investment Trust is a public venture capital fund, created to develop, promote, and expand West Virginia’s economy by making investment funds available to eligible businesses, thus stimulating economic growth and providing or retaining jobs within the State. In the 2022 Legislative Session, SB 523 transferred oversight of the WVJIT to the West Virginia Economic Development Authority, effective June 5, 2022.