Capital Access Program

The Capital Access Program (CAP) is an innovative program that provides lenders access to loans for small businesses. This program encourages lending to businesses which have a more difficult time accessing conventional bank financing, especially start-ups. CAP is a public-private program which allows Participating Lenders to create a reserve to protect against losses on loans approved by the lender and enrolled under the program. Both the lender and the borrower, as well as the WBD Opportunity Fund, LLC (hereinafter the FUND) through a grant provided by the Wisconsin Department of Commerce, set aside funds as a reserve. The grant provides a match as described below. The match allows participants to establish a reserve fund that may be used to offset any losses incurred for loans the lender has enrolled in the CAP program. Details of the program are described below.

 Participating Lenders:

A participating lender may be either:

1. A financial institution regulated by the State of Wisconsin or the United States that is in good standing with applicable regulated authorities; or
2. An entity that has an existing portfolio of loans to small businesses and has as its primary purpose and mission the promotion of community development primarily in a limited geographic area of Wisconsin that is experiencing economic distress.

To review and complete a Participation Agreement please click here.

 Eligible Loans:

Eligibility is fully described in the Lender Participation Agreement, but in general:

1.  A loan amount may not exceed $500,000 without prior approval of the FUND;
2.  Borrower may be a corporation, partnership, joint venture, sole proprietorship, cooperative or other entity, whether profit or non-profit, which is authorized to conduct business in the State of Wisconsin, and the proceeds of the loan will be used for industrial, commercial or other business enterprise, or any combination thereof, within the State of Wisconsin.
3. The proceeds of the loan may not be used for:
         a) Any endeavor devoted to the sale of alcoholic beverages;
         b) The construction or purchase of residential housing; or,
         c) A passive real estate investment.
4. The Borrower does not have a conflict of interest with the Participating Lender and or the FUND.
5. Complete an Loan Enrollment Form.
6. Have the Borrower Representations documented using Exhibit 2 to the Participating Lender Agreement.
7. Document Notice of Enrollment to Borrower using and Exhibit 3 to the Participating Lender Agreement.

Reserve Fund:

The process of building a loan loss fund for enrolled loans is as follows:

1. Borrower shall pay not less than 1.5% of the amount of the loan and not greater than 3.5%.
2.  Participating Lender shall pay an amount equal to the amount paid by the Borrower.
3. FUND shall transfer available funds from the CAP program into the Reserve Fund an amount not less than 100% nor greater than 150% of the combined amounts paid by the Borrower and Lender.

It should be noted that the maximum amount that may be transferred into the Reserve Fund by FUND over any three (3) year period in connection with any Borrower, and affiliates, shall be $150,000.

Here is an example of the impact of a claim by a Participating Lender to the reserve fund based on a balance consisting of loans it enrolled with bank, borrower, and match contributions:

• Loan A Fee - $3,500
• Loan B Fee - $5,000
• Loan C Fee - $2,500

This creates a $11,000 Reserve Fund Balance.

Should Lender experience a loss of $6,000 on Loan B, it may submit a claim to the FUND and reduce the Reserve Fund Balance to $5,000 ($11,000 - $6,000).
 

Should a Participating Lender elect to make a claim, use this Claim Form.

Program Contact Information:
If you have any additional questions please contact: Tim Belter at 608-316-7144 or tbelter@wbd.org.