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Federal Home Loan Bank of Chicago Supports Small Businesses Through New Community First Accelerate Grants and Increased Investment in 0% Advances

Federal Home Loan Bank of Chicago Supports Small Businesses Through New Community First Accelerate Grants and Increased Investment in 0% Advances

The Federal Home Loan Bank of Chicago (FHLBank Chicago) announced two programs focused on supporting small business in Illinois and Wisconsin. The new Community First Accelerate Grants for Small Business and Community Small Business Advance recognize that local businesses drive growth and economic investment in rural, urban, and small town communities. In 2022, FHLBank Chicago expects to award $750,000 in Accelerate Grants and doubled its overall program limit to $2 million for the Community Small Business Advance.

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“Local businesses are the lifeblood of our communities. Restaurants, shops, and small businesses provide jobs, culture, supplies, and deep roots in our neighborhoods and main streets throughout our district,” said Katie Naftzger, Vice President, Community Investment Officer, FHLBank Chicago. “Many local businesses have survived enormous hurdles through the last several years. Now, they are facing unprecedented headwinds like rising labor costs, supply chain constraints, increasing interest rates and inflation. FHLBank Chicago is answering the call of these important economic engines within our communities.”

The new Community First Accelerate Grants for Small Business are designed to assist the growth and development of small businesses, up to $25,000 per business, through FHLBank Chicago members. Grant funds can be used for a variety of purposes, including purchase or improvement of property, equipment, workforce development, and technology – and require impact reporting post-award. Interested small businesses must partner with an FHLBank Chicago member to submit an application for grant funding.

In addition to the grants, Community Small Business Advances are 0% initial fixed rate with a fixed term up to 10 years, available to FHLBank Chicago members to support their local economies. Advances are loans made to our members of varying maturities, with the purpose of providing a secure, low cost source of funds in all economic cycles.  This year, FHLBank Chicago is doubling the overall program limit to a $2 million interest-rate subsidy with a $250,000 individual member limit. Eligible businesses include agricultural operations, commercial, service, retail operations, hospitality, recreation-based businesses, internet-related businesses, social service providers, small-scale industrial and manufacturing operations, trades, and professional services.

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“Our members know their community’s local businesses best and understand the unique needs of these diverse areas,” said Carolyn Jaw, Executive Vice President, Group Head, Sales, Strategy, and Solutions, FHLBank Chicago. “The Community Small Business Advance offers vital capital support, not just to sustain their businesses but to grow, especially after the last two years.”

Holle-Oaks Dairy LLC, a dairy and crop farm in Baldwin, Wis. was able to utilize the Community Small Business Advance from First Bank of Baldwin to purchase a new corn planter. The planter helped the Holle family upgrade to precision planting technology to more efficiently apply seed and fertilizer. This technology investment saves them crop input costs of up to 15% during average years and even more when input costs are higher like they have been in 2022.

“The availability of the Community Small Business Advance has been extremely well received in the Baldwin community,” said, Michael Speltz, Chief Financial Officer, First Bank of Baldwin. “These funds have been extended to agricultural providers and farmers, who have been challenged by commodity pricing as well as the rapidly increasing rate of inflation. Customers have been extremely pleased with this product because it affords them some financial relief in these challenging economic times.”

SRM Construction Material and Supply in Centreville, Ill., is both a minority business enterprise (MBE) and disadvantaged business enterprise (DBE) that employs rebar fabricators, warehouse workers, concrete ready-mix drivers and other union tradespeople. The Community Small Business Advance from Town and Country Bank was used to purchase two new concrete trucks which meant that SRM could expand their work load and hire additional employees in southern Illinois.

“Investment in small business means our communities continue to grow,” said Rob Pickerell, Vice President, Commercial Banking Officer, Town and Country Bank in Edwardsville, Ill. “FHLBank Chicago’s Community Small Business Advance means a business like SRM will be able to stay competitive and participate in regional, state, and federally funded infrastructure projects.”

From 2018 through June 2022, FHLBank Chicago has issued more than $54 million in Community Small Business Advances to create and retain more than 1,800 small business jobs throughout Illinois and Wisconsin.

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