Training Program is an inducement to encourage
plant location in the State.

MARYLAND SMALL BUSINESS
DEVELOPMENT FINANCING
AUTHORITY

Chairperson: Cecil E. Flamer, 1987

Leonard Blackshear, 1987; Lloyd M. Arrington,
Jr., 1988; John J. Oliver, Jr., 1989; Robert B.
Williams, 1989; two vacancies.

Ex officio: Vacancy, Secretary of Economic and
Community Development; William S. James,
State Treasurer

Stanley W. Tucker, Executive Director

World Trade Center, Suite 1353
401 E. Pratt Street
Baltimore 21202 Telephone: 659^t270

The Maryland Small Business Development Fi-
nancing Authority was created in 1978 to make
working capital available to businesses owned by
minority or disadvantaged individuals (Chapter
879, Acts of 1978). Until 1982, assistance was
aimed solely at helping minority firms fulfill
contracts awarded by any level of government.
Under the original program, eligible firms were
required to show an inability to obtain working
capital through private or commercial sources.

In 1982, the General Assembly enabled the
Authority to expand its program. Now, the Au-
thority may offer loan guarantees and, in some
cases, subsidize interest costs of working capital
loans from private lending institutions to minority-
owned firms. The guarantees are backed by a
special revolving fund created by the General
Assembly. The new loan guarantee program does
not limit the use of loan proceeds to work on
government contracts. Loans are made at the
prevailing market rate. Recipient firms, historical-
ly small in size and brief in experience, are usually
considered "high risk" businesses by the private
lender.

The Maryland Small Business Development Fi-
nancing Authority consists of seven members ap-
pointed to five-year terms by the Governor. The
Secretary of Economic and Community Develop-
ment and either the State Treasurer or Comptrol-
ler, as designated by the Governor, serve ex officio
(Code Financial Institutions Article, secs. 13-201
through 13-234).

Economic and Community Development/169

MARYLAND INDUSTRIAL
DEVELOPMENT FINANCING
AUTHORITY (MIDFA)

Chairperson: James C. Johnson III, 1988

William J. Detweiler, 1985; Steven H. Oram, 1986;
John S. Lalley, 1987; Thomas H. Mullaney,
1987; Patricia B. Bissell, 1989; Joseph Haskins,
Jr., 1989.

Ex officio: Vacancy, Secretary of Economic and
Community Development; William S. James,
State Treasurer

Benjamin L. Hackerman, Executive Director and
Secretary

World Trade Center, Suite 2244
401 E. Pratt Street
Baltimore 21202 Telephone: 659^262

The Maryland Industrial Development Financ-
ing Authority (MIDFA) was created to provide
financial assistance to enterprises seeking to locate
or expand their operations in Maryland (Chapter
714, Acts of 1965).

MIDFA operates three loan programs. Under
the Traditional Program and Umbrella Program,
participating companies can finance land acquisi-
tion and the purchase of all types of buildings and
equipment. The Bond Insurance Fund is used as
reserves for financial assistance provided under the
Traditional and Umbrella Programs.

Under the Conventional Loan Program, MID-
FA insures many types of conventional loans made
by financial institutions. The Authorized Purpose
Fund is used as reserves for loans and other
obligations insured under the Conventional Loan
Program. MIDFA also is authorized to issue
bonds under and in accordance with the Revenue
Bond Act.

Through the Traditional Program and its Bond
Insurance Fund, MIDFA insures all or any part of
the payments of principal and interest under tax-
exempt economic development revenue bonds is-
sued by Maryland counties, municipalities, indus-
trial development authorities, and other Maryland
public bodies to finance a specific facility for a
specific company. Revenue bonds are exempt from
federal and Maryland income tax (but not from
real estate or personal property taxes). Therefore,
interest rates on these bonds are generally lower
than interest rates on conventional loans.

Under its Umbrella Program, MIDFA issues,
sells, and insures revenue bonds to provide long-