The SPARK Act creates a new federal program administered by the Small Business Administration to increase access to capital and business support in underserved communities, including minority-owned businesses, women entrepreneurs, and rural areas that currently face significant funding gaps. The bill establishes cooperative agreements with nonprofits, community development financial institutions, and minority-focused lenders to provide grants of up to $20,000 per business and low-interest loans to eligible small business owners, with annual funding capped at $1 million for established participants and $500,000 for new applicants. The SBA must prioritize projects serving economically distressed areas and conduct annual financial examinations and provide technical assistance to participating businesses. Participating entities are required to track and report annually to Congress on key metrics including participant demographics, capital access, job creation, and business survival rates. The bill addresses documented disparities in entrepreneurship funding, noting that minority-owned startups face twice the loan denial rate, women founders receive only 2 percent of venture capital, and rural areas receive less than 1 percent of venture capital funding.
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