Businesses like these on Main Street in downtown Marble Falls were able to apply for COVID-19 emergency loans provided by the Marble Falls Economic Development Corp. The EDC decided to forgive those loans, making them taxable income. Staff photo by Brigid Cooley
The Marble Falls Economic Development Corp. on March 3 voted that city businesses that received COVID-19 emergency loans will not have to repay the money. Forgiving the loans will turn the funds into taxable income for those businesses, said EDC Executive Director Christian Fletcher.
Last year, the EDC, which is funded by a half-cent sales tax collected from Marble Falls businesses, set aside $100,000 to fund a loan program for local businesses suffering economic hardships caused by the pandemic.
Depending on annual income, businesses located within the Marble Falls corporate city limits could apply for either $5,000 or $10,000 loans at a zero percent interest rate for three years. The EDC gave $75,000 in loans to nine businesses; an additional $7,500 in mini-grants were awarded to 14 businesses.
“Our mission is to support the business community, and the money means more to our small businesses right now than it does to the EDC,” Fletcher said.
During the Wednesday meeting, Fletcher informed the board that the EDC’s finance committee advised loan forgiveness “for a variety of reasons,” including work related to loan administration and timing. Board members also noted that Gov. Gregg Abbott’s recent decision to allow Texas businesses to reopen at 100 percent capacity will likely increase local business revenue.
“We knew we wanted to help the people, and we’ve helped a lot of businesses in this community,” said board Vice-President Mark Mayfield. “We haven’t made them comfortable, but we’ve certainly given them a hand up, helping them do it themselves.”
Teresa Carosella, owner of Custom Creations & Interiors, a full-service window coverings showroom located at 513 Main St., used her $10,000 EDC loan to keep staff employed.
“When all this happened, none of us knew what would happen next,” Carosella said. “These funds gave us a stable base to work on until we could open back up.”
Now that the loan has been forgiven, Carosella said she intends to “pay it forward” by donating some of the remaining funds to local charities.
Dennis Reed, who owns five Subway franchise locations in the Highland Lakes, said the EDC loan helped him stay afloat during the height of the pandemic.
“When COVID hit, we were just starting to come out of our annual slow months,” Reed said.
Now considered taxable income, Reed said he will continue to benefit from it.
“We lost so much last year that any income reported is healthy this year,” he said.
Original article as seen on https://www.dailytrib.com/2021/03/04/marble-falls-edc-forgives-covid-19-loans/