SPARK Act

Key Points

• The SPARK Act creates two new SBA programs: the Spark Program (cooperative agreements with incubators and accelerators) and the Spark Financing Program (grants and loans to small businesses in underserved communities). Both programs must be up and running within one year of enactment.
• Eligible organizations include nonprofits, community development financial institutions, minority depository institutions, community colleges, and HBCUs. These groups can apply for 5-year cooperative agreements with 3-year renewal options, receiving at least $500,000 per year.
• The bill specifically targets underserved groups including women, socially and economically disadvantaged individuals, veterans, people with disabilities, tribal members, people with criminal records, rural businesses, and businesses where at least half the employees live in low- or moderate-income communities.
• Small businesses can receive up to $20,000 in grants or low-interest loans through the Spark Financing Program. Participating businesses pay no fees for counseling, mentorship, or financing services received through the program.
• The SBA must submit annual reports to Congress tracking jobs created, capital accessed, business retention rates, and demographic breakdowns of participants by race, gender, veteran status, and location. A separate study is required within two years to evaluate whether program metrics should vary by project type.