EDB assigns $20M to help construction industry obtain federal refunds
Puerto Rico Economic Development Bank (EDB) President Luis Alemañy announced the allocation of $20 million under the State Small Business Credit Initiative’s (SSBCI) “Boost your Business,” or “Impulso a Tu Negocio,” program to provide lines of credit for working capital to companies in the construction industry.
During the announcement, which was made in conjunction with the Puerto Rico Builders Association, it was announced that the funds are part of $109.3 million granted to the EDB by the U.S. Treasury Department through the “Impulso a Tu Negocio” program. The initiative utilizes federal SSBCI funds to bolster local programs designed to support small and medium-sized enterprises (SMEs).
The EDB president explained that, “although at the moment there is an unprecedented amount of federal funds, there are many contractors requesting lines of credit to be able to hire employees [and] pay payroll, operating expenses and utilities and buy materials, with the goal of being able to complete the project and certify it for the Federal Emergency Management Agency or Community Development Block Grant – Disaster Recovery [program] to reimburse them.”
“Without the money beforehand, they cannot execute,” Alemañy said. “Federal funds are not used and contractors end up going bankrupt. The contractor sector is one of the areas with the greatest bankruptcies along with the restaurant sector, among others. The credit lines available from the EDB and this collaborative agreement will help industry members see financing [as] viable, helping the sector continue to deliver positive results throughout 2023.”
Alemañy said that Gov. Pedro Pierluisi “has been emphatic that it is necessary to continue identifying resources to strengthen the construction industry, in order to promote economic development and expedite the infrastructure works that are carried out throughout the island.”
“We will continue to join forces with the different sectors of our economy to support them because their success is the success of Puerto Rico,” he said.
The official stated that the performance of the construction industry is crucial for the development of any region, as it creates and improves infrastructure, thereby increasing fixed capital. This in turn impacts economic activity, local and foreign investment, and generates both direct and indirect jobs.
According to data provided by the EDB’s Center for Economic Studies, cement sales in February, not seasonally adjusted, totaled more than 1.2 million 94-pound bags. That is a 3.4% increase compared to the same month last year and represented the third consecutive positive growth after three years of decline. In January this year, more than 1.1 million cement bags were sold, reflecting an even greater 3.8% increase compared to January 2022.
“We have shown that the construction industry is resilient and necessary,” Builders Association President Vanessa De Mari Monserrate said. “In fact, we were one of the first to restart operations when the strictest measures to control COVID-19 infections were still in place, which turned out to be key in the rebound observed in the sector. Our commitment is to continue supporting small and medium-sized enterprises in this sector, which are fundamental to the future of development in Puerto Rico. These grants offered by the EDB make it possible for our partners and the industry to continue meeting the construction demand that Puerto Rico has.”
The EDB president emphasized the importance of integrating efforts between public and private sectors to ensure success and maintain the growth of construction projects.
“I thank the Puerto Rico Builders Association for the collaboration in continuing to promote Puerto Rico’s economic development and economic recovery,” Alemañy concluded.
