AUSTIN (KXAN) – Small businesses in Austin can now apply for a loan through the Austin Economic Damage Bridge Loan Program.
The loan program, created by the City of Austin’s Economic Development Department, will allow small businesses to apply for a loan of up to $ 35,000. There is $ 6 million allocated to the program, and the program is set up to help up to 170 businesses.
City officials told KXAN they have already received more than 200 applications for candidacy.
The local loan is designed as a stopgap to help businesses keep their employees until they receive emergency funds through the United States Small Business Administration’s Economic Disaster Loan Program. .
“We understand that small businesses in Austin are still on the path to economic recovery,” said Veronica Briseño, director of the economic development department. “Austin’s Economic Injury Bridge Loan program will help small businesses retain employees and pay for expenses such as rent and fixed debt. This is one of the many ways our ministry is supporting small local businesses facing economic losses due to the COVID-19 pandemic. “
To be eligible for the program, businesses must be headquartered in a city council district and applicants must “demonstrate economic loss associated with the COVID-19 pandemic.” They must also have applied for the SBA disaster loan.
All loans have an interest rate of 3.75% and must be repaid within 12 months.
“This is only one of the many solutions that we are looking at,” said Briseño. “We realize the need is great in our business community and our Austin economy, and we are providing that as one tool. “
Many people are still waiting for SBA loans
According to the SBA, a business owner can take out a loan of up to $ 2 million under the SBA’s Economic Disaster Loan program.
In Texas, 1,242 EIDL loans have been approved, amounting to $ 263,469,600. Financial institutions also processed 63,815 EIDL loan advances.
Another loan program available through the SBA is the Paycheck Protection Program. The agency said that “Texas has approved 134,737 loans in the amount of $ 28,483,710,273.”
However, many business owners told KXAN that they are still waiting because the paycheck program is strapped for cash before their claims can be processed.
Carlos Sosa, a musician from Austin, said he was still waiting.
“A lot of my peers, musicians are completely broke,” he said. “The world of music has kind of come to a standstill. No one can go to concerts. No one can have private events.
He initially said he couldn’t find any information from his bank on how to apply. He tried smaller banks, and by the time he was able to submit his application he said, “The next day I see all over the news and stuff that all the money is gone.
The U.S. House of Representatives is due to vote Thursday on a measure that would add $ 310 million to the paycheck protection program.
Sosa said: “I don’t know what to expect. I don’t have much hope. From my experience, I don’t know if it’s going to happen, and I’m not going to bet on it because of what has already happened. If so, something good comes out of it or me and my employees get some kind of relief, that would be amazing. “
Grants for small businesses through private entities
Due to the increased demand for financial support, Briseno said: “We understand that this is a unique situation and the need is great, so we will definitely be working with companies.”
She told KXAN that the economic development department had “redeployed 10 staff, and we’re actually looking to assign additional staff to serve as what we call the case manager. We think it’s important one-on-one with every business and help them identify resources.
The city of Austin has a database that business owners can use to find help, both from public and private entities.
A new resource that became available on Wednesday is the Facebook Grants Program.
Tech giant gives $ 2.5 million to qualifying Austin businesses. They expect to help about 600 small businesses with this money.
Katherine Shapley, vice president of the global business group, said, “Our small businesses are really what gives us the color and uniqueness that makes Austin Austin. We have heard loud and clear that financial support and quick financial support will go a long way. “
You must have between two and 50 people in your business and have been in business for one year to be eligible.