Sunday, May 31, 2020

Puerto Rico Gov Announces Launch of Small Business Financing Program

By on March 24, 2020

(Screen capture of www.cdbg-dr.pr.gov)

Initial Grants of up to $50,000 in CDBG-DR Funds to Assist Micro, Small Businesses

SAN JUAN – Gov. Wanda Vázquez Garced announced that the Small Business Financing (SBF) program, which is financed with funds allocated by the Department of Housing and Urban Development, will be launched Wednesday. The Program will initially offer grants and loans that will assist in recovery of small businesses following hurricanes Irma and Maria.

In its initial Recovery Grant phase, the SBF will offer grants awards of up to $50,000 for working capital, inventory, rent or mortgage, payroll, utilities, or equipment for said companies that suffered losses after the passage of the 2017 hurricanes. 

Following the Recovery Grant phase, SBF will offer the ability to apply for “flexible loans to further implement economic recovery,” the government said, adding that the “Recovery Grants will assist economic recovery across the island by creating new jobs, retaining current employees, and attending the urgent need for assistance that many small businesses in Puerto Rico have as a result of damages caused” by the historic storms.

“Micro businesses and small businesses are essential for the recovery and development of the island. This SBF subsidy, which we have been working on and were preparing for to make this announcement, comes to support this important sector of the local economy, which does not necessarily have the resources or capital that larger companies have,” Vázquez said.

Housing Department Secretary Luis Carlos Fernández Trinchet added in the governor’s press release that “the SBF Recovery Grant will support the economic recovery of the island by creating new jobs, retaining employees, as well as meeting relevant needs that these companies have as a result of the damage caused by the storms.”

The application period is open and those who have the documentation ready can submit it online.

“Our team has personnel available who are analyzing requests remotely, according to the instructions given through Executive Order 2020-23,” Fernández said.

For the purposes of the Community Development Block Grant Grant for Disaster Recovery (CDBG-DR), microenterprises are those companies that have five or fewer employees, including their owner or owners. This includes an autonomous individual. Small businesses are defined as businesses with 75 or fewer employees.

As part of the requirements, applicants must provide evidence of hurricane-related damage or disruption and an unmet need for recovery and growth or creation and retention of low to moderate income jobs.

In order to meet the national objectives of the CDBG-DR program, the secretary indicated that the objective of using 30% of the SBF funds in projects that benefit low and moderate incomes or areas has been established.

The Economic Development Bank of Puerto Rico (BDE by Spanish initials) will serve as general manager of the SBF program under a subrecipient agreement. 

“The BDE has taken on this task together with the Housing Department to help business people affected by the storms with great responsibility and a great commitment to our people, which goes above all else. This way, we continue—together with our employees—promoting stable economic development and fulfilling our institutional mission,” BDE President Pablo Muñiz said in the release.

The BDE will be responsible for managing all major aspects of the program, such as performing CDBG-DR compliance reviews; conducting admission and eligibility reviews; implementing financial management and compliance reports; as well as performing grant calculations and draw schedules.

The institution will also provide applicant and customer support; prepare grant agreements and related documents; and maintain documentation and records.

The application can be accessed at www.cdbg-dr.pr.gov, where additional information on eligibility requirements and program guides is available. Those interested can also email EcoRecCDBG@vivienda.pr.gov or call 1-833-234-2324.

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