Business Relief RGV to provide loans to help McAllen businesses affected during COVID-19 pandemic
Texas Border Business
Today, the City of McAllen, partnered with Affordable Homes of South Texas, Inc. (AHSTI) to provide loans to small businesses in McAllen affected by the COVID-19 global pandemic. The City of McAllen Community Development Block Grant (CDBG) CV-Program, in collaboration with AHSTI, doing business as Business Relief RGV, will provide loans up to $25,000 at zero percent interest, for businesses in McAllen with less than 50 employees.
“Small business is the lifeblood of any city’s financial success, especially here in McAllen with so many innovative entrepreneurs who have helped to create the economic landscape of the community, providing jobs, and unique services and products,” said McAllen Mayor Jim Darling. “The funding will help our small business community to stay open, keeping people employed and providing the goods and services that makes McAllen the retail center in not only the Rio Grande Valley but also, South Texas.”
The goal of the loan program is to help those local and small businesses in McAllen with funds that may be used for working capital, covering expenses of workforce needs, including staff salaries, leasing space, insurance, and/or utilities. Additionally, loans for inventory, supplies, furniture, software, and equipment may also be considered. Loans will range in value up from a minimum request of $1,000 and up to $25,000 at zero percent interest and will be approved based on such factors as must be in good standing with the Texas Secretary of State; applicants are 51% majority owner of a business; can show need; are not in bankruptcy; are current with all local, state and federal taxes, fees and any other debt payments to the City of McAllen; and can provide evidence of being able to provide one job for at least three years of loan for a qualified low/moderate-income household.
All loans have a three-year term.
“Small businesses are experiencing severe financial distress due to the economic impact of COVID-19,” said Bobby Calvillo, Executive Director of AHSTI. “We are proud to further our partnership with the City of McAllen to help small business owners in our community stay afloat during these unprecedented times.”
Funds will be disbursed for documented eligible project expenses and paid directly to third-party vendors and not the businesses directly. Further, businesses must allow the City of McAllen to collect income and demographic data from business loan applicants and their employees for three years.
The application process includes the following documentation:
- Listing of all bank deposits and debt schedule
- Business entity formation documents
- Credit report on all principals and a business credit report on the borrowing entities
- Personal financial statement
- Most current year personal and business tax returns
- Current and year-end financial statements
- Projected financial statements for the next 6-12 months
- Bank statements from January 2020 to current to show the decrease in revenue as a result of COVID-19
- Conflict of interest documents
- Income documentation from applicants and employees.
Application and loan information can be found at www.businesshelprgv.org.
The funding source for the Business Relief RGV comes from the U.S. Department of Housing and Urban Development CDBG COVID-19 CV Fund. Applications will be underwritten according to the approved guidelines. Completed applications, including all documents outlined above, are considered on a first-come, first-served basis.
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