BROWNSVILLE – The topics of small businesses and out-of-work employees dominated the conversation during U.S. Rep. Filemon Vela’s hour-long telephone town hall on April 15.
The topics of health care and agriculture as they relate to the COVID-19 pandemic were also broached, but most of the half dozen questions presented to Vela’s panel were about the benefits offered to individuals and small businesses in the CARES Act, which was signed into law by President Donald Trump on March 27.
Vela (D-Brownsville) himself opened the conference call with a question he received from a constituent about one of the major benefits of the CARES Act, the $600 weekly bonus that will be paid to those who file for unemployment during the pandemic.
Texas Workforce Commission Executive Director Ed Serna, one of the members of Vela’s panel of experts, fielded the question.
He first explained that, as part of the CARES Act, even individuals who weren’t previously eligible for unemployment benefits will now be eligible, including individuals who are self-employed, contract employees and employees of non-profit organizations.
Serna said that anyone who files or is going to file for unemployment benefits will need to follow the same process, which is to submit an application through one of the commission’s “soon-to-be eight call centers” or online.
The extra $600, Serna said, will be automatically added to the individual’s benefit amount when it is disbursed.
“I will be the first to confess something that everybody knows. Our phone lines are absolutely jammed with people who are trying to get benefits,” Serna said. “... We are working to resolve the phone line backlog, so I would recommend to people that they go online to submit this benefit application.”
Serna added that his organization has already handled more than a million claims, more than 90 percent of which have been online.
Later during the town hall, in response to a question from a small business owner, Serna explained that even individuals who were moved from full time to just part time are eligible to receive that $600 bonus.
He said that those individuals would need to report the income they are still receiving so their basic benefit could be adjusted, but that the $600 is a fixed amount that is offered to everyone who is receiving unemployment benefits.
The panel then fielded questions about health care and agriculture, but the talk quickly returned to the desperate need for help for small business owners, with Vela saying that most of the questions he’s received over the past two weeks have been about help for small businesses.
The congressman listed the three major programs made available in the CARES Act, taking time to touch on each of them.
The first of those is the Paycheck Protection Program (PPP).
“The way that program is supposed to work,” Vela said, “is the banker will lend the small business enough money to cover payroll, rent, utilities, things like that, for up to about two months.”
Congress, Vela explained, dumped $349 billion into that program as part of the CARES Act, adding that he expects even more funding to come as well.
The PPP, while overseen by the United States Small Business Administration, is available through local lenders. A list of lenders who offer the program is available on the SBA’s website at sba.gov.
Angela Burton, the district director for the SBA’s Lower Rio Grande Valley District, said the PPP is “very healthy in the state of Texas.”
“I got numbers yesterday where we have done more than 88,000 PPP guaranteed loans for almost $22 billion, and that’s just for the state of Texas,” she said.
The loan, which can be for up to $10 million, is determined by the businesses average payroll over the previous eight weeks plus an additional 25 percent.
The SBA, according to its website, will forgive the loan with no repayment required provided “all employees are kept on the payroll for eight weeks, and the money is used for payroll, rent, mortgage interest or utilities.”
The other two programs fall under the Economic Injury Disaster Loan (EIDL) program, which Congress approved the SBA to access to help struggling business in the wake of the pandemic.
The first of those two is a $10,000 emergency grant that the SBA calls an EIDL Loan Advance.
“The roll out of that program has been more challenging,” Vela said.
Burton later added that she had confirmed the receipt of that grant money from several businesses and had heard from her offices that more payments were going out daily.
The second of those programs under the EIDL is a traditional loan.
“The problem is that the coronavirus economic impact is widespread, so there’s a real overload in the system,” Vela said. “We’re hoping to put more money into that pot.”
Those loans, Burton said, can be for up to $2 million, and they can be used for fixed debt, payroll, accounts payable and other bills. They carry an interest rate of 3.75 percent for small businesses and a 2.75 percent for private non-profits with up to a 30-year long-term repayment plan.
Kevin J. Keller is the sports editor at the Bee-Picayune and the Advance-Guard and can be reached at 343-5223, or at sports@MySouTex.com, or follow him on Twitter, @beegoliadsports.