Since 1973, the University of Houston-Victoria has formally educated thousands of Victorians. Our graduates work in various capacities in both corporate and small business environments. Through our entrepreneurial tracks, we formally educate students interested in having their own small business. We also foster and support small business success, growth and development through hosting your local Small Business Development Center since 1987. To say we have a vested interest in local small business is an understatement.
The Small Business Administration initially injected $349 billion into developing the Paycheck Protection Program Loan. Small businesses could see financial relief through the PPP and Economic Injury Disaster Loan program. After a mere 14 days, the PPP was drained, and as of Friday, the EIDL had funded $7.96 billion.
Round two funding by our government provides a second injection of $310 billion into the PPP and $70 billion into the EIDL program. SBA will resume processing EIDL loan and advance applications that are already in the queue on a first-come, first-served basis. New applications are not being accepted. Round two funding is expected to dissolve quicker than the initial funding. It’s entirely likely that there are not enough funds for those in the queue. Additionally, there will be businesses that will not be able to even apply for the EIDL program. These facts support that there are simply not enough funds from the federal government to distribute to every small business. There will be gaps.
On April 21, the Victoria City Council voted not to partner with microlender LiftFund. As many know, LiftFund would accept a $750,000 grant from the City of Victoria. Of that, $680,000 would be available for no-interest emergency disaster loans. The remaining $70,000 was an interest buy down that allowed applicants to receive a no-interest loan, as well as overhead and administrative costs for LiftFund. To compensate for the $70,000, LiftFund committed to raise that amount through grants. Some of the issues discussed during the Council meeting revolved around administrative fees, qualification processes and risk level.
While LiftFund may not be the answer, I would encourage Council to mull over what may be a more reasonable program or idea. Perhaps an internal grant program could be considered to eliminate any and all risk as well as administrative costs. Regardless of program style, the funds obviously won’t be distributed among every small business in the city. The same holds true for the federal funds we’ve relied on thus far. We need to try to bridge the gaps for our community’s small businesses. The alternative is to stand by and do nothing at all.
Now, more than ever, is an opportunity to support and extend a helping hand to our small business community, which is vital to the economic health of Victoria, and to support the ones who have supported us. So often, we call upon our small businesses to provide donations to our local extracurricular activities and sponsor our local events – youth organizations, nonprofit fundraisers and festivals alike. They are our vendors. They are valued community members. They are a valued part of our community identity. They are involved. They are local. And time is of the essence.