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C-Suite Wednesday — Poll: How should SBA Regulate CDC Economic Development Activity?

January 20, 2016

By Bob Coleman
Editor, C-Suite Wednesday

C-Suite Wednesday — Poll: How should SBA Regulate CDC Economic Development Activity?

Yesterday, I ran the notice of SBA’s intention to better define a CDC’s economic development commitment.

The key issue is the tradeoff between how much cash reserves the CDC should hold, and how much economic development activity should SBA require the CDC fund.

Please take this quick two minute poll to share your thoughts with the industry!

I believe most CDCs act prudently in providing and funding economic development activities.

    • True
    • False

What is an acceptable level of cash reserves for future operations the CDC should hold before funding economic development activities?

    • 3 months of operating expenses
    • 6 months of operating expenses
    • 12 months of operating expenses

Or, should the CDC have the option to calculate the cash reserve based upon (Check all that apply)

    • A percentage of the loan portfolio balance
    • A percentage of the annual servicing fees
    • A percentage of the surplus or profit

Should SBA limit the amount that CDCs may retain as a cash reserve?

    • Yes
    • No

If yes, what would be the maximum amount?

Should SBA require CDCs to first apply any remaining funds to the reserve before using any remaining funds for investments?

    • Yes
    • No

Should SBA require a CDC to reserve a percentage of revenue for economic development activities?

    • Yes
    • No

If yes, what percent?

Should SBA require a CDC to reserve a percentage of remaining funds, e.g. profit for economic development activities?

    • Yes
    • No

If yes, what percent?

Should SBA have the ability to limit executive director compensation?

    • Yes
    • No

If yes, how much, or what benchmark?

Should the definition of economic development activity include business or technical procurement assistance: (Check all that apply)

    • Provided by the CDC
    • Paid by the CDC
    • Neither

My job is primarily related to:

  • CDC industry
  • SBA 7(a) Lending
  • Small Business Lending
  • SBA/Government
  • Other

Final comments?

Take the survey here.

Thanks!

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