EB-5 and TEA
EB-5 is a federal Immigrant Investor Program that provides developers with an additional financing option and allows foreign investors to obtain citizenship through U.S. Citizen and Immigration Services by investing in new commercial enterprises within a Targeted Employment Area (TEA). The San Marcos TEA covers approximately 80 percent of the two-county region.
The statewide Historically Underutilized Business (HUB) Zone Empowerment Contracting Program facilitates the use of HUBs in federal, state, and local procurement to minority and woman- owned businesses.
The program aims to increase employment opportunities, stimulate capital investment in HUB areas, increase employment opportunities, and offer economic leveraging in the community.
Eligible businesses must be registered as a small business by U.S. Small Business Administration (SBA) standards, be owned and controlled by a U.S. citizen, and be located in a HUB zone with at least 35% of its employees also residing in the zone. The Texas State University SBDC can help assist eligible companies register with the SBA.
New Market Tax Credits
A large portion of the Greater San Marcos region qualifies for New Market Tax Credits (NMTC). NMTC investments allow businesses to access more favorable lending terms and conditions than the market typically offers. Terms can include lower interest rates, flexible provisions such as subordinated debt, lower origination fees, higher loan-to-values, lower debt coverage ratios and longer maturities.
To the end borrower, NMTC’s are almost indistinguishable from a conventional loan. Depending on the lender you use they may be able to work the entire loan for you. If your lender doesn’t deal in NMTC’s, GSMP can put you in contact with consultants who work in this field to guide you through the entire process. Your lender or a consultant can put an actual dollar amount to the savings value of using NMTC.
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