Empire State Development has spirit of giving

Some small-business people on Long Island will have something to be thankful for - thanks to the state. The Empire State Development Corp., the state's economic development arm, said $25 million will soon be made available - including $3.5 million to Long Island - from New York's Small-Business Revolving Loan Fund. Gov. David A. Paterson approved the funding last July.

Manhattan-based Accion USA, a microfinance organization that makes loans to Long Island and New York City businesses, will receive $1 million; the Community Development Corp. of Long Island is to receive $500,000; and $2 million will go to Seedco Financial Services, which provides financing for small businesses in low-income areas, EDC said. Seedco has operations on Long Island and in Manhattan.

Steve Cohen, EDC's deputy commissioner, said the allocations are the first under the program Paterson approved. The three organizations will receive low-interest loans from the state and are required over the next two years to match the amounts they got.

One of the prime reasons for the loans is banks' lackluster lending to small businesses.

"The pool of unbankable businesses is growing," Cohen said, noting that state approval rate for loans under $250,000 has fallen nearly 50 percent in the past four years.

Bob Larson, the Community Development Corp. vice president and chief lending officer, said the agency, which provides a variety of services to homeowners and small businesses, is anticipating an improving economy and wants to use the money to extend loans to small businesses to help them grow and create jobs.

"We anticipate that over time the consumer mood is going to change" and that businesses will need funding for growth. Is Larson an optimist?

"I have to be," he said. "It goes with the territory."