While the government shutdown may be over, revisiting its effects are still needed to understand the future of America’s Quarter 1 economy. According to WCPO, more than $112 million in local business expansion projects were put on hold during the shutdown. HCDC Inc. which is one of the region’s largest small business lenders intimated that their backlog of 35 loans “could potentially not close” due to the shutdown length.
The U.S. Small Business Administration is among the agencies deemed non-essential during the shutdown. Patrick Longo, CEO of HCDC, the county’s lead economic development agency, expressed his frustration during the event saying, “People are being harmed. People are being delayed. Business is being frustrated because of politics in Washington.”
Longo made it known that the 35 pending loans represented $36.8 million of HCDC funding, $57.6 million were from supporting bank loans and a combined $112.4 million in new business investment.
The 35 projects held in abeyance were supposed to employ 377 workers in Ohio and Kentucky. Out of the total, 21 loans were for an “under-served market,” which meant companies in expansion mode owned by minorities, women or veterans.
During the shutdown, the White House estimated that quarterly economic growth would fall by 0.13 percent for every week the shutdown continued. Some economists are now concerned about the longstanding impact from the idle 800,000 federal workers.
While Longo believes that all of the deals in HCDC’s backlog, will in time be financed nothing is definite yet. Usually, SBA loans have last-minute changes or deadlines. Longo warned that the end result could be the cancellation of an expansion project if it fails to close within the set time frame.