Main Street Lending Program Made More Accessible for Tribal Businesses

Effective July 15, 2020, the Federal Reserve granted a waiver for tribal government businesses from the dividend prohibition of the Main Street Lending Program. The Main Street Lending program was created to support the economy by ensuring small and medium-sized businesses have the credit they need during the COVID-19 crisis. While tribal businesses were deemed eligible for the program on April 30, 2020, the restrictions on dividends prevented tribes from applying for this program.

According to newly released FAQs on the Main Street Lending Program, a tribal business with ownership interests either wholly or majority-owned by a tribal government may pay dividends or make capital distributions to the tribal government. Tribal governments then use these dividends or capital distributions to fund essential government services such as healthcare, education, and public safety. For the purposes of Main Street Lending Program eligibility, a tribal government is defined as, “a federally or state recognized Indian tribe and does not include Alaska Native corporations.”

The Federal Reserve established three facilities: Main Street Loan Facility (MSLF), Main Street Priority Loan Facility (MSPLF), and Main Street Expanded Loan Facility (MSELF).  The MSLF offers loans ranging from $250,000 to $35 million, MSPLF loans range from $250,000 to  $50 million, and MSELF loans range from $10 million to $300 million. To be eligible for either facility, a tribal business must meet one of the following conditions:

  • Have 15,000 employees or fewer.
  • Or had 2019 annual revenues of $5 billion or less.

This expanded access to the Main Street Lending Program is a win for tribal businesses and will provide much-needed capital to Indian Country.

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