Travis County’s small business grant program sees $2.5M in requests in three days

In April, Travis County approved $10 million in grant funding to aid small businesses affected by the economic crisis caused by Covid-19. However, it was only last week that Travis County businesses outside of Austin had their first chance to determine whether they qualified for the relief grants.

“We’ve seen over $2.5 million in requests come through so far, and that’s in the first three days,” Raquel Valdez Sanchez, the chief operating officer of the nonprofit Business & Community Lenders of Texas, told the Austin Monitor. She said the requests are coming from all county precincts, and not all of them are asking for the maximum $40,000 in grant funding.

Due to the widespread need throughout the county, both BCL and Travis County are anticipating more requests for aid than the $9 million can provide ($1 million of the funding was directed toward administrative costs). In order to sift through the requests and provide aid to the most vulnerable businesses, the county asked BCL to prioritize businesses that meet the following criteria: woman- or minority-owned; employ or are owned by low-income individuals; located in low- to moderate-income census tracts; and did not employ a third party to fill out the application.

“Priority is not an exclusion; it is simply a way to help us sort through what we anticipate to be a large volume of applications,” Christy Moffett with the county’s Planning and Budget Office told the Monitor. She said if more than 250 applicants qualify but are requesting smaller sums of money, the county will consider increasing the number of businesses that receive funding until it spends the full amount of federal grant funding.

As the county is targeting businesses with fewer than 25 employees and a maximum net annual revenue of $500,000, BCL is expecting that many eligible small business owners will require technical assistance in filling out the application to qualify for grant funding.

Valdez Sanchez explained to the Monitor that the application process can be convoluted and many small businesses do not have a dedicated department or trained staff member to apply for grants.

Travis County Commissioner Margaret Gómez told the Monitor that many of the small businesses in need of cash assistance are unfamiliar with the paperwork requirements associated with grant applications. She said the county selected BCL due to its extensive involvement with small community businesses and its approach to lending. “They’re really involved with them,” she said.

To assist business owners, BCL staff will review the eight-question eligibility applications to determine if business owners correctly filled out the questionnaire. If there are any inconsistencies or an applicant qualifies for aid, BCL will reach out to the individual directly to confirm the data. “We’re going to dig,” said Valdez Sanchez, who clarified that this individualized approach will continue throughout the process.

The businesses selected when the full application process opens on July 6 will receive not only a cash infusion but will be required to attend business coaching sessions through BCL and develop a business continuity plan. Sessions will include consultations on marketing, financial saliency plans, contingency planning and addressing unforeseen challenges.

The requirement for businesses to develop a contingency plan was a major driver behind Travis County’s choice to partner with BCL to distribute the grants. “It’s not just about the infusion of cash,” Moffett said. “We really want to make sure they have what they need to move forward.”

Commissioner Gómez called the mandatory professional guidance a “bonus,” saying that many of the businesses qualifying for the grant are not otherwise able to afford hands-on business coaching or strategic planning.

BCL will require business coaching sessions until the program ends in December. Following that, the nonprofit lender will reach out to the businesses that were awarded grants in the summer of 2021 with the objective of understanding how many were able to remain open after going through the program and receiving a financial boost.

Moffett said this long-term, educationally minded approach to emergency funding is a method not many other counties have pursued. She said Travis County will compare the success of its program at the end of 12 months to the success rate of other programs in the nation to determine if future grants and aid funding will incorporate a similar structure.

This article has been changed since publication to change Christy Moffett’s title. Photo made available through a Creative Commons license.

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