South Texas county to consider doling out $40M in COVID-19 aid to small border businesses

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Texas communities under 500K so far missing out; If approved, new $3T package could change that, congressman says

Hidalgo County Judge Richard Cortez wants to allocate $40 million in federal CARES funds for local small businesses affected by the pandemic. (Courtesy Photo).

McALLEN, Texas (Border Report) — Hidalgo County Judge Richard Cortez wants to use a quarter of the federal coronavirus aid sent to his county to help small businesses in dozens of South Texas border towns.

Local leaders say most of the region has yet to receive “much-needed money” from the first massive stimulus package, known as the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act.

But not Hidalgo County, which is the only jurisdiction in South Texas south of San Antonio to receive federal stimulus funds. This is why Cortez told Border Report that he is aggressively pursuing a distribution of $40 million from the $151.5 million the county received to provide relief to small businesses that have been hardest-hit during the economic shutdown the coronavirus caused.

“It’s so important we do this,” Cortez said via phone.

Unlike Hidalgo County, Texas communities with populations under 500,000 so far have missed out on direct federal aid from the CARES Act, which was approved by Congress and signed by President Donald Trump on March 27 to pump $2 trillion back into local economies.

Nancy Pelosi, Kweisi Mfume, Tiffany McMillan
House Speaker Nancy Pelosi of Calif., talks to reporters on Capitol Hill, Tuesday, May 5, 2020, in Washington. (AP Photo/Manuel Balce Ceneta)

However, a second massive stimulus bill announced Tuesday afternoon by House Speaker Nancy Pelosi proposes spending $3 trillion more for coronavirus relief, and local leaders hope there are provisions to ensure the distribution of funds to less-populated regions. The House is expected to vote on the bill Friday.

The $3 trillion HEROES Act (Health and Economic Recovery Omnibus Emergency Solutions Act) would put aside nearly $1 trillion to state, local, territorial and tribal governments and establish a $200 billion “Heroes Fund” to extend hazard pay to essential workers. It would also send a second — and larger — round of direct payments to individual Americans, up to $6,000 per household.

U.S. Rep. Filemon Vela, D-Texas, represents the Gulf Coast region of South Texas. (Courtesy Photo)

U.S. Rep. Filemon Vela, a Democrat from South Texas, told Border Report that he hopes the new package will better aid border communities. Vela said he has to study the massive 1,800-page legislation, which was just released, but he said he hopes it will better cover the distribution of relief funds to small businesses and hard-hit less-populated areas, such as Cameron County.

The State of Texas received a total of $11.2 billion in CARES funds, and $3.2 billion was distributed directly from the federal government to cities and 12 Texas counties with at least half a million people, including Hidalgo County. The state received $8 billion and is supposed to distribute at least $1.8 billion to counties and cities under 500,000 population, but Vela said that hasn’t happened.

Vela said that Cameron County, on the Gulf Coast, with a population of about 422,000 should receive $76 million, based on population funding formulas. Likewise, to the north, smaller Willacy County with just 22,000 people should receive $3.9 million.

“If the state distributed that money in proportion to what the federal government did to the bigger places, the counties (and cities within) would get their fair portion,” Vela said. “We all think that the federal distribution (including Hidalgo) is fair. We all think the state distribution to the other 242 counties is unfair.”

If the state distributed that money in proportion to what the federal government did to the bigger places, the counties (and cities within) would get their fair portion.”

U.S. Rep. Filemon Vela, D-Texas

Hidalgo County, which has upwards of 1 million residents and is located across the Rio Grande from the Mexican state of Tamaulipas, received $151.5 million, U.S. Rep. Vicente Gonzalez, a Democrat who lives in McAllen, announced Tuesday.

U.S. Rep. Vicente Gonzalez, D-Texas. (Border Report File Photo/Sandra Sanchez)

“Our local governments and municipalities are bearing the brunt of this crisis and need assistance,” Gonzalez said. “These federal funds will help many in Hidalgo County that have suffered due to the COVID-19 pandemic, but there is still much work to do for other cities and counties in the 15th District of Texas. My mission to ensure that every city in my district receives the funding they need to resume operations for their citizens.”

Gonzalez said the CARES Act provided $150 billion in stabilization funds for states and larger communities, but unfortunately, cities and counties with fewer than 500,000 residents don’t meet the population threshold to receive direct assistance from the U.S. Department of Treasury.

Cortez, in a video news conference, said his county is prepared to step up and offer these funds to qualifying small businesses in the border region.

“As a community, we are facing truly challenging times. Our lives have been dramatically altered by an enemy we cannot see. We are surrounded by a danger that threatens the elderly, the sick and the compromised. For almost two months now, we have operated under a public health disaster declaration,” Cortez said. “Now, to begin our economic recovery, we must give financial assistance to our local small businesses and individuals who have been affected by our public health emergency order.”

Throughout McAllen, businesses that once were thriving are now shuttered and there are dozens of “for sale” and “for lease” signs on window fronts. Strip malls that once were full of merchants are now void of many small businesses that were mainstays in the community.

Cortez said he would ask the 5-member Hidalgo County Commissioners’ Court to approve distributing $40 million for small business relief. Commissioners met Tuesday morning, but the issue was not discussed in open forum.

An announcement is expected to come later this week with information on guidelines for businesses to qualify and apply for relief funds. A news conference is scheduled for Friday, according to the Hidalgo County website.

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