By Hannah Curran, Editor
JEFFERSON COUNTY — The U.S. Small Business Administration (SBA) announced the opening of a Business Recovery Center (BRC) at the Hoover Recreation Center in Hoover on Thursday, January 6 to provide Alabama businesses with one-on-one assistance in submitting a disaster loan application if they were impacted by the severe storms and flooding on October 6 – 7, 2021.
SBA has several different programs, but the program that SBA is offering in Jefferson County is specifically the office of disaster assistance.
“Small Business Administration’s Office of Disaster Assistance mission is to provide low-interest disaster loans to businesses of all sizes, private nonprofit organizations, homeowners, and renters to repair or replace real estate, personal property, machinery and equipment, inventory and business assets that were damaged or destroyed in the declared disaster,” Public Affairs Specialist Sharon Gadbois said.
There are several disaster loans available to meet the needs of different people in the community:
- Business Physical Disaster Loans – Loans to businesses to repair or replace disaster-damaged property owned by the business, including real estate, inventories, supplies, machinery, and equipment. Businesses of any size are eligible. Private, non-profit organizations such as charities, churches, private universities, etc., are also eligible.
- Economic Injury Disaster Loans (EIDL) – Working capital loans to help small businesses, small agricultural cooperatives, small businesses engaged in aquaculture, and most private, non-profit organizations of all sizes meet their ordinary and necessary financial obligations that cannot be met as a direct result of the disaster. These loans are intended to assist through the disaster recovery period.
- Home Disaster Loans – Loans to homeowners or renters to repair or replace disaster-damaged real estate and personal property, including automobiles.
Gadbois explained that SBA helps homeowners, renters, businesses, and non-profits affected by the October 6 and 7 flooding by offering low-interest fixed-rate loans that aid in the recovery process.
“Anyone who has had damage from the October floods, resides and/or has a business in either Jefferson or Shelby County qualifies,” Gadbois said. “Then all businesses in the following counties, which is the Bibb, Blount, Chilton, Coosa, St. Clair, Talladega, Tuscaloosa, and Walker counties qualify for EIDL loans or economic injury disaster loans. So essentially, we cover underinsured and uninsured losses, SBA loans help repair, replace, and rebuild back to pre-existing conditions.”
The loan amounts limits depend on the loan type:
- Business Loans – The law limits business loans to $2,000,000 for the repair or replacement of real estate, inventories, machinery, equipment, and all other physical losses. Subject to this maximum, loan amounts cannot exceed the verified uninsured disaster loss.
- EIDL – The law limits EIDLs to $2,000,000 for alleviating economic injury caused by the disaster. The actual amount of each loan is limited to the economic injury determined by SBA, less business interruption insurance, and other recoveries up to the administrative lending limit. EIDL assistance is available only to entities and their owners who cannot provide for their own recovery from non-government sources, as determined by the U.S. Small Business Administration.
- Business Loan Ceiling – The $2,000,000 statutory limit for business loans applies to the combination of physical, economic injury, mitigation, and refinancing, and applies to all disaster loans to a business and its affiliates for each disaster. If a business is a major source of employment, SBA has the authority to waive the $2,000,000 statutory limit.
- Home Loans – SBA regulations limit home loans to $200,000 for the repair or replacement of real estate and $40,000 to repair or replace personal property. Subject to these maximums, loan amounts cannot exceed the verified uninsured disaster loss.
“Homeowners can use it for the structure of their home,” Gadbois said. “Also debris removal, fences, landscaping, it can be used for contents inside the home or business, business inventory, machinery, furniture, furniture fixtures. We do help cover cars as well, and then for economic injury, disaster loans, that’s what we also call EIDL loans. That’s working capital, to help with the cash flow of the business to return back to normal operation, essentially.”
These funds can be used to prevent damage from happening again. There’s a mitigation aspect to the loan, so when you’re talking to a loan officer or case manager, you’re going to want to mention mitigation if that’s something you’re interested in.
“You could do like a safe room or storm shelter, sump pump, elevation, retaining walls, and landscaping to help protect property and occupants from future damage caused by a similar disaster,” Gadbois said.
You have up to 30 years to pay back the loan, and then there’s also no prepayment penalty.
“So if somebody wanted to pay off the loan early, there wouldn’t be a fee to do that,” Gadbois said. “Also, the rate for the homeowners and renters is 1.563, and for businesses, it’s 2.855, and then for the nonprofits is 2 percent.”
If you are located in a declared disaster area, you may be eligible for financial assistance from the SBA. Applicants may apply online, receive additional disaster assistance information, and download applications at disasterloanassistance.sba.gov. Applicants may also call SBA’s Customer Service Center at (800) 659-2955 or email disastercustomerservice@sba.gov for more information on SBA disaster assistance. In addition, individuals who are deaf or hard-of-hearing may call (800) 877-8339. Completed applications should be mailed to U.S. Small Business Administration, Processing and Disbursement Center, 14925 Kingsport Road, Fort Worth, Texas 76155.
The filing deadline to return applications for physical property damage is Monday, February 21, 2022. The deadline to return economic injury applications is Wednesday, September 21, 2022.