General Description

CAIP is a program established to assist U.S. companies that are doing business in areas of the country that have been negatively affected by NAFTA. Funds administered by Treasury (see below) allow for the payment of fees on eligible loans. These fees include the 7(a) program guaranty fee (and subsidy) and the 504 program guaranty, CDC and lender fees. Depending on the loan size, the fees can be sizeable.

The CAIP works with the SBA in both the 7(a) Loan Guarantee Program and 504 Program to reduce borrower costs and increase the availability of these proven business assistance programs.

Eligibility

To be eligible, certain criteria must be met; for example, the business must reside in a county noted as being negatively affected by NAFTA, based on job losses and the unemployment rate of the county; this was recently expanded to allow for granting eligibility to defined areas within a county (which will allow SBA to react quickly in offering to provide assistance when, for example, a plant closes).

In addition, there is a job creation component. For 7(a) loans, one job has to be created for every $70,000 SBA guarantees. For 504 loans, one job has to be created for every $50,000 SBA guarantees.

Eligible CAIP Communities

Currently, over 230 counties in 29 states are designated as eligible. Here is a listing of all communities (PDF File) which have been designated as eligible for funding under the Community Adjustment and Investment Program (CAIP). This second file contains the eligible zip codes for urban communities.