The Economic Development Bank, the Family Department’s Socio-Economic Development Administration, known as ADSEF, the Puerto Rico Chamber of Commerce (CofC) and the United Retailers Association (CUD) announced Thursday the signing of a pair of agreements to launch a job promotion plan for low-income residents.
Through the first agreement, ADSEF will assign $1 million from the Puerto Rico Tax Incentives Act to finance the “Economic and Social Rehabilitation for Families in Extreme Poverty Program,” to provide funding to help eligible participants — who must be recipients of Nutritional Assistance Funds and Temporary Assistance for Needy Families assistance — develop small businesses.
The EDB will provide loans of up to $15,000, with the possibility of increasing the amount to $30,000 upon evaluating the proposal, to those who qualify.
“This new agreement aims to benefit a non-traditional sector in entrepreneurship, which certainly deserves equal importance in this administration’s economic development plan,” said EDB President Ivonne Otero. “Microenterprise is a source of self-employment for many Puerto Ricans and we seek to become partners to provide appropriate funding to promote these new businesses.”
Essentially, the goal is to help families find self-sustainability by creating their own businesses, said Esteban Pérez Ubieta, ADSEF administrator.
The second agreement established an alliance between the government agencies, the CofC and the CUD to promote job creation for people with limited resources by granting salary reimbursements to companies that hire TANF program beneficiaries.
The trade groups will tap into their business networks and educational resources to support companies wanting to benefit from the incentives, by providing orientation assistance in filling out and turning in the required paperwork.
“The more involvement there is in the program, the greater the benefit the island will receive, since small and medium businesses have the capacity to generate more jobs, which in turn will benefit their operations,” said CUD President Ignacio Veloz.
Conceding that one of the greatest challenges local companies face is payroll expense, CofC President Salvador Calaf said assistance from ADSEF and TANF will represent a “breather” for businesses.
“One of the major challenges facing employers in Puerto Rico is paying employees. Operating costs on our island are not the lowest,” he said. “And while we reconcile the issue of the skills of our people, the ability of our businesses to maintain their workforce, and compliance with our island’s labor regulations, this type of aid may be a respite in the efforts of our businesses to move forward and create jobs.”
The EDB will provide financing opportunities of up to $22,600 at the current prime interest rate to retailers. The agreement is open to other trade groups that benefit the island’s small and mid-sized business sector, Otero said.