Posting Language
Title
Authorize a contract for a small business interest loan buydown pilot program for Austin Economic Development with Peoplefund, for a term of one year with up to two one-year extension options in an amount not to exceed $1,500,000. Funding: $500,000 is available in the Fiscal Year 2025-2026 Operating Budget of Austin Economic Development. $500,000 is available in the Fiscal Year 2026-2027 Operating Budget of Austin Economic Development. Funding for the remaining contract term is contingent upon available funding in future budgets.
Body
Lead Department
Austin Financial Services.
Client Department(s)
Austin Economic Development.
Fiscal Note
Funding in the amount of $500,000 is available in the Fiscal Year 2025-2026 Operating Budget of Austin Economic Development.
Funding in the amount of $500,000 is available in the Fiscal Year 2026-2027 Operating Budget of Austin Economic Development.
Funding for the remaining contract term is contingent upon available funding in future budgets.
Procurement Language:
Austin Financial Services issued a Request for Qualifications Statements solicitation RFQS 5500 RGW4005 for these services. The solicitation was issued on January 12, 2026, and closed on February 24, 2026. Of the three offers received, the recommended contractor submitted the best evaluated responsive offer. A complete solicitation package, including a log of offers received, is available for viewing on the City’s website. This information can currently be found at https://financeonline.austintexas.gov/afo/account_services/solicitation/solicitation_details.cfm?sid=142937.
MBE/WBE:
This solicitation was reviewed for subcontracting opportunities in accordance with City Code Chapter 2-9B (Minority-Owned and Women-Owned Business Enterprise Procurement Program). For the services required for this solicitation, there were no subcontracting opportunities; therefore, no subcontracting goals were established.
For More Information:
Direct questions regarding this Recommendation for Council Action to Austin Financial Services - Central Procurement at: FSDCentralProcurementRCAs@austintexas.gov or 512-974-2500. Respondents to the solicitation and their Agents should direct all questions to the Authorized Contact Person identified in the solicitation.
Additional Backup Information:
The contract will provide services to lower or eliminate interest rates on loans made to eligible small businesses within Austin, using City-funded interest buydown assistance. The contract allows the City to partner with a financial institution who originates, underwrites, services, and monitors loans in alignment with program guidelines.
Since Austin Economic Development’s first Small Business Needs assessment in 2000, access to capital has consistently ranked as a top need for Austin’s small businesses. The small business interest loan buydown program is an access to capital program that provides small businesses loans with competitive market rates through subsidizing the interest rate cost. The small business interest loan buydown program directly supports the goal of providing funding for businesses to survive in Austin, by reducing interest rate costs for local businesses to allow a business owner to apply savings toward investing in the growth of the business and catalyze hiring of local residents. Pilot year funding of $500,000 is estimated to result in a leverage ratio of 5:1 equivalent to 75-100 new small business loans, for a total deployment of $3-$4 million over one year subject to program demand and borrower credit quality.
This is a new contract. The requested authorization amount was determined by departmental estimates and forecasted usage.
An evaluation team with expertise in this area evaluated the offers and scored Peoplefund as the best to provide these services based on organizational capacity & experience, lending policies, underwriting & risk management, marketing outreach & strategy, and compliance & reporting capabilities.
If the City is unable to secure a contract, small businesses relying on this pilot program would be unable to reduce the cost of their existing high-interest debt.
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Contract Details: |
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Contract Term |
Length of Term |
Contract Authorization |
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Initial Term |
1 year |
$500,000 |
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Optional Extension 1 |
1 year |
$500,000 |
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Optional Extension 2 |
1 year |
$500,000 |
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Total |
3 years |
$1,500,000 |
Note: Contract Authorization amounts are based on the City’s estimated annual usage.