Small Business Recovery Modifications

Plain English Breakdown

The effective date is not provided in the official metadata or summary.

Small Business Recovery Modifications

This law changes the small business loan program to support all Colorado businesses regardless of COVID-19 impacts, updates how funds are matched and used for loans or equipment, and removes pandemic-specific hardship rules.

What This Bill Does

• Changes the program goal from helping with COVID-19 recovery to supporting any small business in Colorado regardless of pandemic impact.
• Allows fund money to be matched dollar-for-dollar with other sources before being used for loans or equipment purchases.
• Permits loan payment delays for hardship without requiring that the hardship be caused by the pandemic.
• Removes rules that set aside specific amounts of money for each county based on local business metrics.
• Requires new funding to support businesses across the whole state while keeping targets for rural areas and minority-owned firms.

Who It Names or Affects

• Small businesses in Colorado applying for loans or equipment purchases
• The program oversight board that manages loan decisions
• Rural counties, women, minorities, and veterans who own businesses

Terms To Know

Tranche

A specific portion of money created when fund dollars are matched with other sources.

Participation interest in loans

Buying a share of an existing loan to help provide funding for businesses.

Limits and Unknowns

• The official text does not state the exact date when this law becomes effective.
• The specific targets for rural counties and minority-owned businesses are determined by the board, but the numbers are not listed in this summary.
• The total amount of money currently available in the fund is not specified.

Official Summary Text

The act changes the purpose of the small business recovery and resiliency loan program (program) from supporting small businesses recovering from the economic crisis caused by COVID-19 to supporting Colorado's small businesses regardless of COVID-19 impacts.
The act provides that money in the small business recovery and resiliency fund (fund) may be matched by participants in the program at a ratio of $1 of fund money for every $1 of money from other sources. Once the money from the fund is matched by other sources and comprises a tranche, the act specifies that the money from the tranche may be used for loans or to purchase participation interest in loans for businesses as determined by the program oversight board (board), including working capital and the purchase of equipment.
The act allows a deferral of principal and interest payments on a loan made through the program for circumstances of hardship and repeals the requirement that the hardship must be caused by the COVID-19 pandemic or ongoing economic conditions.
The act repeals a requirement that money from the fund must be proportionally reserved for applications from eligible borrowers located in a county based on the county's metrics related to small businesses, as determined by the board, for an initial period of time and that the money must be allocated to a county. Instead, the act requires each tranche of loan funding to be used to fund businesses across the state over the duration of the program and to maintain targets and support businesses located in rural counties and businesses owned by women, minorities, or veterans. The program will track the distribution of capital to counties.
The act requires the state treasurer to transfer $5 million from the fund to the Colorado startup loan program fund on June 30, 2026.
(Note: This summary applies to this bill as enacted.)