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Lift Fund pitches low-interest loan partnership for Rio Grande City small businesses
Summary
Marlene Rodriguez of Lift Fund proposed a partnership with the Rio Grande City EDC to create an interest-buydown loan program to expand access to affordable credit for small businesses; Lift Fund described underwriting standards, typical loan sizes, and local impact metrics from prior work in the community.
Marlene Rodriguez, business development officer for Lift Fund, told the Rio Grande City Economic Development Corporation that Lift Fund is proposing a partnership to create an interest-buydown program to help local small businesses access affordable loans.
"We are proposing that Lift Fund and Rio Grande EDC partner up so that we can help small businesses with access to affordable interest loans," Rodriguez said during the meeting. She described Lift Fund as a nonprofit small-business development financial institution that started work in Rio Grande in 2000 and has maintained a local presence since.
Rodriguez outlined how the program would work: Lift Fund underwrites applicants and the EDC could allocate local funds to buy down interest rates. She said Lift Fund’s typical retail interest rate is around 14.5% prior to any buy-down, and that partner cities have reduced the effective rate to as low as 2.5% or 0% by subsidizing interest. Rodriguez said loans can be used for equipment, inventory, payroll and working capital, and that loans can be approved up to $50,000 with an average loan in the range of $20,000.
She also provided program-level statistics for Rio Grande City from Lift Fund’s records: since 2000 Lift Fund reported making 62 loans in the city totaling $896,000, with about 35% female-owned borrowers, 98% classified as minority-owned and 65% in low- and moderate-income areas, figures Rodriguez said were pulled from Lift Fund’s system.
Board members asked how the city’s contribution would work and whether borrowers would face closing fees; Rodriguez said the city would typically allocate a sum dedicated to buying down interest and that a small closing fee is added to the loan and handled as part of the underwriting.
The presentation was listed as an informational (non-action) item; no formal vote or commitment was taken at the meeting. The board did not take immediate action but discussed referring the item to staff for budget workshop follow-up and potential inclusion in future budget discussions.
