Starting a business can be hard. It takes creativity, time, and money.
To help our members and community members, start, grow, and scale their business, we’re starting a series of columns about resources available to business owners in Sacramento.
- The Grow Sacramento Fund: applicants to this loan program can receive loans from $75,000 to $2,000,000. The loans can be used for permanent working capital, refinancing debt from non-SBA loans, leasehold improvements, and property acquisition. While there are multiple qualifications, the most significant are that the applicant must be located in Sacramento County and have been in operation for more than three years. Applicants can expect lower down payments and interest rates than from other loan sources.
- Small Business Administration loans: While the SBA is available to more than just Sacramento residents, their loans come with a lot of competitive benefits. Lower rates and fees, flexible overhead requirements, and some loans require no collateral. Plus, the SBA provides counseling and education to help you make great financial decisions. Loans range from $500 to $5.5 million. Companies must fall under a revenue or employee threshold, which varies by industry.
- California Capital Financial Development Corporation: The CCFDC is a 501(3)c registered nonprofit focused on local economic development. One of their marquee offerings is the Small Business Loan Guarantee program, which helps small business get loans by guaranteeing them. The funds must be used in California but have less stringent use requirements than other programs. Loans will be guaranteed for up to 80% of the loan, up to $2.5 million total, and for up to seven years. They also provide direct microloans up to $25,000.
Real Estate Investment
Maybe you don’t need a loan, but you need a building to use for your business or as an investment property.
- Opportunity Zones: Sacramento is home to 29 Opportunity Zone census tracts. There are areas in which real estate investors are given multiple federal tax incentives to invest an in area. Benefits include deferral of capital gains taxes, reductions of capital gains, and tax-free appreciation if the investment is held for at least 10 years. Taken together, these benefits can result in massive savings.
- The Brownfields Program: This program is designed to help evaluate and remediate property, which may have a hazardous substance, pollutant, or contaminant. While it may not be the most attractive real estate at the start, using these funds to fix the property can save you some money and help improve Sacramento. The Brownfields program estimates that every $1 spent on cleanup efforts results in $7 in economic activity within five miles of the site.
- SMUD and PG&E rebates: Your electric company may issue rebates for certain kinds of green improvements. SMUD offers rebates for improved refrigeration equipment, commercial food service equipment, lighting, and HVAC equipment. The rebate is worth up to $20,000 per year, and the improvements will save you a lot in energy costs. PG&E provides rebates for improving HVAC systems, water heating equipment, refrigeration systems, food service equipment, and pipe insulation. PG&E also provides loans between $5,000 and $4 million for these projects.