EDA RLF Program
The EDA Revolving Loan Fund Grant Program provides grants to communities to capitalize a Revolving Loan Fund. As part of the Economic Adjustment Assistance Program, EDA regional offices award competitive grants to units of local government, state governments, institutions of higher education, public or private non-profit organizations, approved economic development district organizations, and Indian tribes to establish Revolving Loan Funds (RLFs).
EDA's RLF recipient, in turn, disburses money from the RLF to make loans at interest rates that are at or below market rate to small businesses or businesses that cannot otherwise borrow capital. As the loans are repaid, the grantee uses a portion of interest earned to pay administrative expenses and adds remaining principal and interest repayments to the RLF's capital base to make new loans. A well-managed RLF award actively makes loans to eligible businesses and entities, continues to revolve funds, and does not have a termination date.
A Certified Capital Company (CAPCO) is a private government-sponsored venture capital company formed to increase the availability of growth capital for small businesses located in Texas. The program is also intended to stimulate job creation in Texas by requiring supported businesses to have at least 80 percent of payroll/manpower located within Texas. It's one way small businesses in Texas receive venture capital.
To be eligible, the business must be headquartered in Texas (or relocate to Texas within 90 days of the CAPCO's first investment); the business can have no more than 100 employees at the time of investment; 80 percent of payroll/workforce must be located within Texas; the primary business activity may be manufacturing, processing or product assembly, research and development or tangible services. The business may not be primarily engaged in retail sales, real estate development, insurance, banking, leasing, lending or professional services. By statute, a percentage of the CAPCO investments must be used for early stage businesses and businesses located in strategic investment areas. Get more information about CAPCO and the application process.