ALBANY — State officials announced a plan on Tuesday to provide financial assistance to minority- and women-owned businesses, expanding on successful initiatives enacted in recent years.
The new program, called the New York State Surety Bond Assistance Program, helps minority- and women-owned businesses ? called MWBEs ? to secure bonds and state contracts. The program will provide credit to businesses through a revolving loan fund.
The fund will provide lines of credit up to 30 percent of the contract amount to companies for each project. The program would provide $200 million in bonds over the next five years, officials said.
?This is a significant advancement,? said Alfonso David, the state?s deputy secretary for civil rights. ?Minority-and-women-owned businesses have had significant challenges obtaining credit, so we?re very proud of this program.?
David said the program would help create 2,200 direct and indirect jobs in the state and add $328 million in revenue from goods and services purchased by the companies.
The program comes on the heels of laws passed in recent years under the Cuomo and Paterson administrations. In 2010, Gov. David Paterson signed into law four bills that encouraged growth of MWBEs and allowed for better state financial support.
In recent years, the number of MWBEs has grown in New York. For example, the firms that are involved with investment banking and the issuance of debt went from 4.2 percent MWBE in 2007 to 23.9 percent in 2010.
Last July, Gov. Andrew Cuomo created the Bonding Guarantee Assistance Program, which provided $10 million to help MWBEs secure credit.
As part of Cuomo?s 2012-2013 budget, the governor included $1.6 million in additional funding for MWBE operating funds. The budget is required to be approved by lawmakers by April 1.
Yrthya Dinzey-Flores, the state?s chief diversity officer, said the program will initially aim to offer bond assistance to 90 companies.
Kenneth Adams, the president of the Empire State Development Corp., said the new program was important to help MWBEs grow .
?These are small firms by definition. They don?t have a long track record ? within the state, so it?s very, very difficult for them to get that bond,? Adams said.
Other initiatives announced Tuesday are designed to help MWBEs expand in New York.
MWBEs participation will now be reported through a new electronic compliance database, the officials said. In the past, there was no standard method of reporting within New York?s contract procurement process.
The state will be better equipped to monitor whether or not state agencies are hiring MWBEs in line with the governor?s desire for improved participation, state officials said.
Officials said MWBE firms will now be able to be certified by municipalities and the federal government faster through agreements reached with the Port Authority of New York and New Jersey, the U.S. Department of Transportation and other government agencies.
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