JEFFERSON CITY, Mo. (AP) - A Missouri program that offers low-interest loans to small businesses and farmers would become permanent under legislation given final approval Wednesday.
The Senate's vote sends to the governor a bill to repeal a scheduled Dec. 31, 2015, expiration date for the Missouri Linked Deposit Program. Under that program, the state deposits money in banks at low interest rates, and the banks in turn make low-interest loans to qualifying applicants.
Although the state deposits are renewed annually, banks often make five-year, fixed rate loans. The legislation should ease potential concerns among lenders, said Missouri Treasurer Clint Zweifel, who oversees the program.
"We provide absolute certainty to Missouri's farms and small businesses that this program can continue, and it not going to be yanked and fall by the wayside halfway through the terms of a loan," Zweifel said. "This ensures we can make promises that we can keep."
Zweifel said there currently are about $325 million of loans outstanding under the program, which is available to farms, businesses with fewer than 100 employees, public entities and individuals who install solar, wind or other alternative energy sources for their homes or buildings.
The program was expanded under a 2009 law to make more entities eligible for the loans and to encourage greater participation by allowing the interest rates on the state deposit to dip below 1 percent.
Zweifel said about 300 Missouri bank branches participate in the program, which he said is about triple the number from when he took office in January 2009.
Loan bill is HB109.