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SANTA FE – New Mexico businesses have received about $340 million in grants and minimum-interest loans from the state under programs intended to help keep businesses afloat during the COVID-19 pandemic, a state official tasked with distributing the relief funds told lawmakers Tuesday.
In all, more than 9,500 businesses around the state received loans or grants, with some businesses qualifying for more than one type of financial relief, said Marquita Russel, the chief executive officer of the New Mexico Finance Authority.
Businesses in Santa Fe and Lincoln counties got the most relief funding per capita in New Mexico, with businesses in the food service and accommodation industries receiving the largest amount of relief funding – about one-third of all money awarded.
Bernalillo County received the most total funding under the programs, but the county was sixth-highest in the state on a per capita basis, according to NMFA data.
Rep. Patricia Roybal Caballero, D-Albuquerque, said she was glad to see rural counties also receive funding under the grant and loan programs.
“It gives us a really clear view of how we’re dispersing everything,” she said during Tuesday’s meeting at the state Capitol.
The small business loan program uses funding from the state Severance Tax Permanent Fund to give low-interest loans, while the grant programs are funded by both state and federal dollars.
Interest rates for loan award recipients have increased in recent months – from 1.625% to 2.75% – but are still lower than interest rates offered by commercial banks, Russel told members of the legislative Investments and Pensions Oversight Committee.
“Even though interest rates have risen … these businesses don’t have access to funds at these rates anywhere else,” she said.
Meanwhile, the small business loan program received far more applications and awarded more loans after being retooled during the 2021 legislative session.
During the first four months applications were accepted in 2020, more than half of loan applications received by the New Mexico Finance Authority were denied, due in large part to strict eligibility requirements such as a stipulation qualifying businesses be at least 80% owned by New Mexicans.
Since the program was revised to relax some of those requirements and increase the maximum loan amount to $150,000, about $120 million in loans have been approved with a 75% loan application acceptance rate, according to NMFA data.
However, the $160 million in small business loans awarded to date is still far short of the $500 million made available for the relief program. After being extended earlier this year, the loan application deadline is currently set for the end of this year.
The cut-off for the two business relief grant programs has already passed.