September 28, 2025

Small Businesses Face Challenges in Texas Due to Tariffs and Water Restrictions

News Summary

Small businesses in Texas, particularly in Corpus Christi, are grappling with significant challenges, including rising expenses from tariffs and strict water restrictions. Entrepreneurs are struggling to maintain their operations amid economic strains and are increasingly seeking support from community lenders. The U.S. Chamber of Commerce is advocating for tariff relief, while local business owners are facing extreme limitations on resources, with some experiencing dramatic drops in revenue. As the situation remains tense, the future of small enterprises in the region hangs in the balance.

Texas – Small businesses across Texas are facing serious challenges in their growth due to recent tariffs and stringent water restrictions. As economic conditions worsen, many entrepreneurs are struggling to maintain their operations and plan for the future, leading to heightened levels of frustration and uncertainty in the community.

LiftFund, a community lender specializing in providing support to small and micro businesses, is stepping up to help entrepreneurs navigate these turbulent times. Unlike traditional bank loans, LiftFund offers a variety of funding options that are reportedly more accessible for small business owners, providing critical financial support in a volatile economic environment.

The economic impact of tariffs has been particularly severe for business owners like Alon Bernstein, who runs B & B Diamonds in Austin. Having operated his diamond business since 1996, Bernstein has recently begun to experience financial losses due to tariffs affecting his exports for re-cutting gemstones, complicating both wholesale transactions and manufacturing processes. Consequently, he faces challenges in maintaining cash flow while dealing with the unpredictability associated with tariffs.

Raji Srinivasan, a marketing professor, highlights that small businesses often operate under constraints in cash flow and human resources, making them especially vulnerable to external economic pressures like tariffs. This sentiment has prompted the U.S. Chamber of Commerce to advocate for relief from tariffs affecting small businesses, urging the Trump administration to act. Reports indicate a historic influx of small business owners seeking assistance, prompting a formal request for tariff exclusions aimed at small business importers.

Simultaneously, Corpus Christi is battling significant water challenges. The city has introduced Stage 3 water restrictions, which have severely limited outdoor activities, such as watering lawns and washing vehicles. These restrictions have dealt a heavy blow to local businesses. For instance, Mike Garcia, owner of the landscaping company 360 Landscape, has reported a staggering 75% drop in business and has been forced to reduce his staff from ten employees to just four. Garcia hopes to secure a city grant of up to $50,000 to ensure his business’s survival, but he requires an increase in customer inquiries to stabilize his financial situation.

City officials have also raised concerns that the situation may worsen, with Stage 4 water restrictions being implemented as early as May 2025. Such action could further constrain both residents and businesses, bringing additional uncertainty to the community. The current Stage 3 restrictions do not adequately address industrial water consumption, which represents about 60-80% of the city’s water usage.

Industries, including Tesla’s Lithium Refinery, which is expected to consume approximately 8 million gallons of water daily, remain in focus as at least 30 corporations challenge a recent water rate hike that aims to reduce costs for more water. Navigating the water flow in Corpus Christi is complicated, given that water is purchased and sold by multiple entities, making management and access difficult.

City Water CEO Drew Molly has express interest in exploring solutions such as desalination to address the long-term issue of water scarcity. The Inner Harbor Desalination Plant is projected to produce 30 million gallons of water daily, with half earmarked for industrial use, a move that could alleviate some pressure on local resources. However, environmental advocates criticize the city’s prioritization of corporate needs over community requirements concerning water management.

As Texas small businesses continue to navigate these challenges, the economic landscape remains tense. With pressure mounting from both tariffs and water usage restrictions, the outlook for many local businesses could remain precarious in the foreseeable future.

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Author: STAFF HERE COLLEGE WRITER

The COLLEGE STATION STAFF WRITER represents the experienced team at HERECollegeStation.com, your go-to source for actionable local news and information in College Station, Brazos County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the Brazos Valley Fair & Rodeo, Chilifest, and Aggie Muster. Our coverage extends to key organizations like the Bryan-College Station Chamber of Commerce and United Way of the Brazos Valley, plus leading businesses in education, biotechnology, and retail that power the local economy such as Texas A&M University, Fujifilm Diosynth Biotechnologies, and H-E-B. As part of the broader HERE network, including HEREAustinTX.com, HEREDallas.com, HEREHouston.com, and HERESanAntonio.com, we provide comprehensive, credible insights into Texas's dynamic landscape.

STAFF HERE COLLEGE WRITER

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