SACO — The Biddeford Saco Area Economic Development Corporation received $1 million of financing from the Small Business Administration Friday, which will go toward awarding loans to small businesses.

The organization was one of 20 nationwide, and one of two in New England, to receive financing through the Intermediary Lending Pilot Program. The Biddeford Saco Area Economic Development Corporation received the maximum awardable amount.

This is the first of three years for the pilot program, which was established under the Small Business Jobs Act of 2010.

The Small Business Association presented the award to the Biddeford Saco Area Economic Development Corporation Friday at the Saco Transportation Center.

“It is a great opportunity for the Biddeford Saco area and the York County regional economy,” said William Armitage, executive director of the Biddeford-Saco Area Economic Development Corporation.

The organization will pay off the $1 million to the SBA with a 1 percent interest rate over a 20-year period, with payments deferred for the first two years, according to information on the SBA website.

The organization will use the money to provide loans for small businesses.

“With many questions about in today’s economy, every effort to help small businesses is critical to our economic recovery,” said Armitage.

The money can be used to fund start-up, newly established and growing small businesses, said Jeanne Hulit, New England regional administrator for the Small Business Administration.

The Biddeford Saco Area Economic Development Corporation was created in 1992 by the cities of Saco and Biddeford and the Biddeford-Saco Chamber of Commerce and Industry with the goal to promote sustainable, long-term economic prosperity in the area.

Armitage said the organization is already reviewing applications for the loan program. The organization is a gap lender, he said, often providing funding businesses need to supplement the loans they get from banks. Armitage said the organization works with banks and helps the businesses that banks support become successful.

The loans through the Intermediary Lending Pilot Program will be distributed throughout York County, said Armitage.

Small businesses are critical to the local economy, said Armitage.

Too often, in the state of Maine, one sees communities that are dependent of one or two employers, he said. The more diversified the economy is, the more viable it is during an economic downturn, he said.

— Staff Writer Liz Gotthelf can be contacted at 282-1535, Ext. 325 or egotthelf@journaltribune.com.