The EXPAND Program assists Phoenix businesses in obtaining loans from eligible local financial institutions. EXPAND provides additional collateral, up to 25 percent of a loan amount. The amount of the collateral enhancement can range as high as $150,000. There is no ceiling on the loan amount. Loans can be for virtually any legitimate business purpose. Jobs creation is an essential element of any request for EXPAND assistance. With EXPAND, the successful applicant/borrower is able to receive a loan and the lender is in a more secure collateral position.
How does EXPAND Work?
- EXPAND is not a substitute for a conventional loan. Rather, it works in partnership with lenders to make credit more readily available to growing businesses.
- The EXPAND collateral reserve encourages lender participation by providing additional collateral for loans that otherwise could not be approved.
- The EXPAND collateral reserve deposit is pledged in an amount up to 25% of the loan, to a dollar ceiling of $150,000.
- A minimum of one permanent job must be created for every $35,000 of EXPAND collateral provide.
Who is Eligible?
- Be owned by a citizen or a lawful permanent resident of the United States.
- Have a net worth of no more than $7.5 million and profits (after federal income tax) of no more than $2.5 million, averaged over the past two years.
- Be located within the City of Phoenix. To find out if your business is located in the City of Phoenix, visit the "Find My Council District" webpage. The best way to ensure your business is eligible is by contacting us at 602-262-5040.
- Be a for-profit retail, manufacturing, wholesale, or service company.
- Have at least two years of operating history. Although the program does not prohibit assistance for start-up ventures, they will be considered only in exceptional cases.
Business involved in:
- speculative ventures,
- investment-oriented activities,
- illegal activities,
- substantial sale of alcohol,
- or any activities not consistent with the City's economic development goals are ineligible for EXPAND.
What Types of Projects are Eligible?
- Land acquisition for commercial development
- New construction
- Purchase or remodel of existing building
- Working capital needs
- Leasehold improvements
- Business acquisitions
How Does a Typical Project Work?
- The owner establishes a business relationship with a lender who considers providing financing if additional collateral or equity can be obtained.
- The lender seeks collateral assistance from EXPAND. If approved, EXPAND agrees to provide the lender with the additional collateral security.
- The business owner is required to provide a minimum of 10 percent of the total project costs as equity.
- The business owner and the lender negotiate the financing terms.
- When the loan is approved and funded by the lender, EXPAND provides the Collateral Reserve Deposit Account for up to four years.
- Personal guarantees of the business principles are required.
- Within the first two years of the project, the business owner must strive to create a minimum of one job for every $35,000 of collateral provided by EXPAND.
In the following table there are three example financial situations to help you understand how a typical project would be financed.
|Total Project Costs||Loan Amount||Borrower's Equity Amount||EXPAND Amount||Total Job Creation Required|
Want to Apply for EXPAND?
The City charges a one-time, nonrefundable application fee of $100 when the application is submitted. To learn more about the fee, please contact us before submitting your application.
- Download, complete, and sign the application. Click here to download.
- Send the application to:
Community and Economic Development Department
200 West Washington Street, 20th floor
Phoenix, Arizona 85003-1611
Questions and Concerns?
If you should have any questions about filling out this form, please contact Kedrick Ellison at 602-262-6007.