Jobs for New England Member Frequently Asked Questions
Members who are seeking answers to some frequently asked questions about Jobs for New England, please refer to the below.
What is the Jobs for New England Program?
Traditional JNE is an interest-rate subsidy program designed to enhance our members’ economic development lending activities. The subsidy is used to write down interest rates to 0% on Classic Advances that finance qualifying loans to small businesses located in New England with a focus to create or preserve jobs in New England communities.
What is the deadline to apply for JNE funds in 2022?
The JNE application and funding period opens February 16, 2022 at 9:00 a.m. and closes November 16, 2022 at 3:00 p.m. JNE advances are requested on a per-project basis. Members may submit multiple requests. Funds will be allocated on a first-come, first-served basis.
By when do my JNE advances need to be disbursed?
Upon approval, JNE advances must be disbursed within 90 days or by December 30, 2022 at 12:00 p.m., whichever is sooner.
Is there a prepayment fee on JNE advances?
Members will be subject to the Bank’s standard prepayment fee in the event they choose to prepay the JNE advance. However, fees for prepaid JNE advances will be net of any unamortized subsidy on the advance.
How does Traditional JNE work?
JNE provides 0% rate Classic Advances (principal paid at maturity) to members in terms from one- through 10-year maturities to support eligible small businesses in New England. In the current round, JNE funds are limited to $200,000 in interest-rate subsidy per member for the program year. (A per-member JNE subsidy limit of $100,000 was established for the August 17 funding release, which includes previous amounts committed to each member. For this funding round, any member who has reached the $100,000 limit is not eligible to participate.)
How are Traditional JNE funds allocated?
Applications are considered on a first-come, first-served basis in this round. The subsidy represents the present value of FHLBank Boston’s cost to fund the 0% rate JNE advance. JNE advances may be requested through multiple project requests, provided that the aggregate subsidy allocated to all projects of a single member funded does not exceed $200,000 in a single funding round. (A per-member JNE subsidy limit of $100,000 was established for the August 17 funding release, which includes previous amounts committed to each member. For this funding round, any member who has reached the $100,000 limit is not eligible to participate.)
New for 2022! The JNE subsidy pool will be funded with $1 million on February 16 to open the round. An additional $500,000 of subsidy will be added on both April 13 and June 16, 2022. Any unused or returned subsidy from the program year will also be added back to the funding pool. The $200,000 per-member cap will apply to the entire program year. (A per-member JNE subsidy limit of $100,000 was established for the August 17 funding release, which includes previous amounts committed to each member. For this funding round, any member who has reached the $100,000 limit is not eligible to participate.)
How does the application process work?
Members must submit individual project application(s) on behalf of eligible borrower(s) by logging in to FHLBank Boston's Community Lending website at housing.fhlbboston.com. New online users can easily create an account at this site. Please note that new account access approval may take up to 48 hours. Applications will be reviewed by FHLBank Boston within three business days. Members will have the sooner of 90 days to request disbursement of funds from approved applications, or by December 30, 2022. Members must call the Member Funding Desk at 1-800-357-3452 to request JNE advance disbursement(s). Small business loans funded by JNE advances must meet at least one of the requirements noted on this page.
What spread should we apply to the loan? Is there a cap?
The advances provided by FHLBank Boston for Traditional JNE loans empower you to offer business loans at below-market rates with spreads comparable to your other loans. The spread cannot be greater than the spread normally charged for a loan of comparable risk and term. For example, a borrower seeking a $1 million loan for a seven-year term was quoted a rate of 3.72% if it was based on funding with a seven-year Classic Advance. This rate included a member cost of funds of 1.27% and a spread of 245 basis points. With the JNE program, the member would be advanced the funds at 0%, and the borrower would now be given a rate of 2.45% for the seven-year term. This example would utilize $84,806 of the member’s allocated subsidy and pass the interest rate savings through to the borrower.
Are nonprofit borrowers eligible?
No. Nonprofits are not eligible for Traditional JNE advances. Your borrower must qualify as a small business, as defined by the Small Business Act (15 U.S.C. 632(a)) and implemented by the SBA under 13 CFR part 120 504, or any successor provisions.
Can my financial institution fund a Community Development Financial Institution (CDFI) or quasi-financial intermediary involved in small business lending?
Yes. Members may use Traditional JNE funds to capitalize a small business loan fund administered by a CDFI or other quasi-financial intermediary, provided the end loan made to the small business meets the general requirements of the JNE program. This includes meeting at least one of the Job Opportunity & Retention or Economic Development criteria, spread over JNE funds, and reporting requirements.
Can Traditional JNE funds be used for a refinance?
Yes. Refinance transactions are eligible for JNE financing if the refinance meets program requirements. The new loan must be at least 115% of the refinanced loan amount and proceeds must be reinvested back into the business. The new interest rate must be lower than the original rate and comply with other pricing terms of the Traditional JNE program. A minimum of 85% of the funds being refinanced must also have originated from expenses that would have been deemed eligible for JNE funding.
How does FHLBank Boston review and approve my application?
Traditional JNE project applications (potential borrowers or loans) are reviewed and approved based on the extent to which they satisfy program eligibility and interest spread requirements. Members will receive a notification of approval or a request for additional information within three business days of FHLBank Boston’s receipt of an application.
Are there any reporting or compliance requirements after taking down a Traditional JNE advance?
Yes. We will ask members to supply a copy of the promissory note within 30 days following JNE funds being disbursed. As part of this submission, members will complete a short, one-time online report describing how the funds were used and demonstrating that the spread did not exceed the member’s typical spread for a loan of comparable risk and term.