Texas House Bill HB3536

Texas 2021 - 87th Regular

Caption

Relating to the use of the Texas Enterprise Fund for a small business loan guarantee program.

Impact

In terms of state law, the implementation of HB3536 will require amendments to existing legislative frameworks concerning the Texas Enterprise Fund. By allowing the Fund to engage in loan guarantees, the bill aims to bolster economic development statewide, particularly in fostering a competitive landscape for small businesses. This potential increase in financial assistance for small enterprises is designed to stimulate job creation and economic activities across various sectors within Texas.

Summary

House Bill 3536 establishes a program to utilize the Texas Enterprise Fund for guaranteeing loans specifically aimed at small businesses. The bill mandates that loans eligible for a guarantee must meet the criteria set forth by the United States Small Business Administration's 7(a) loan program, which is designed to support small businesses with access to financing. The maximum loan guarantee under this program would be set at $2 million per business, allowing for substantial financial support to aid small enterprises in their growth and stability.

Contention

The discussions surrounding HB3536 may involve varying viewpoints on the efficacy and scope of government involvement in funding small business initiatives. While proponents argue that such support mechanisms are critical for local economies, critics could raise concerns about the sustainability of public funding in guaranteeing loans and the potential for misuse of the funds. Thus, there may be a debate over ensuring stringent oversight and accountability measures to monitor the effectiveness of the program in achieving its intended goals.