Recovery Centers Open for Businesses Affected by Oil Spill

Recovery Centers Open for Businesses Affected by Oil Spill

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 The U.S. Small Business Admin istration has opened Business Recovery Centers in six southeastern Louisiana parishes. Owners of small businesses that have been affected economically by the Deepwater BP Oil Spill can visit the centers to speak with SBA representatives about their options with respect to the agency's Economic Injury Disaster Loan program.

The SBA declaration covers the primary Louisiana parishes of Jefferson, Lafourche, Orleans, Plaquemines, St. Bernard and St. Tammany, the neighboring Louisiana parishes of Assumption, St. Charles, St. James, St. John the Baptist, Tangipahoa, Terrebonne and Washington and the neighboring Mississippi counties of Hancock and Pearl River.

SBA Administrator Karen Mills activated the loan program in those jurisdictions on May 5, under the SBA's authority to offer economic injury assistance in response to a request from Gov. Bobby Jindal the previous day. Mills' declaration makes SBA's Economic Injury Disaster Loans (EIDL) available immediately to help meet the financial needs of qualifying small businesses following the oil spill on April 20.

“It is critical that we take every step we can to provide small businesses with resources to make it through this latest crisis so they can continue to drive local economic growth and provide good-paying jobs,” Mills said. “We will be in Louisiana as long as we are needed and until we get the job done.”

SBA customer service representatives are available at the Business Recovery Centers (BRCs) — sponsored by SBA and Louisiana Economic Development — to meet one-on-one with owners of small businesses that have been affected financially by the Deepwater BP oil spill to answer questions about SBA's economic injury disaster loan program, issue loan applications, explain the application process, and help each business owner complete their application.

“Affected small businesses in the region will find personalized service on low-interest loans and disaster information at the centers,” said Michael W. Ricks, director of SBA's Louisiana District Office. “We recognize that some affected businesses may be reluctant to seek a loan to meet their immediate financial needs, but we encourage each business owner to meet personally with a customer service representative to learn how an SBA disaster loan can provide much needed cash flow while waiting for payment of any claims for reimbursement.”

Counselors from Louisiana's Small Business Development Centers also will also be available at each center and will provide services that include assessing business economic injury, evaluating the business's strength and cash flow projections, counseling on how to best overcome the effects of the disaster, and most importantly, reviewing options to ensure each business makes decisions that are appropriate for its situation. These counseling services are free.

With the EIDL loans, the SBA is offering working capital loans of up to $2 million at an interest rate of four percent with terms up to 30 years.

The loans may be used by small businesses that are unable to obtain credit elsewhere to pay fixed debts, payroll, accounts payable and other bills that can't be paid because of the disaster's impact. These loans can provide vital economic assistance to fishing and fishing-dependent businesses to help overcome the temporary loss of revenue they are experiencing. The SBA encourages businesses to also file claims with BP. Borrowers may be required to use any claim payments to help repay these SBA loans.

Understanding the financial challenges many of these business owners currently face, the SBA is also strongly encouraging its participating 7(a) lenders and Certified Development Companies (CDCs) to consider on a case-by-case basis deferment relief for borrowers with SBA-guaranteed 7(a) loans and 504 loans.

Small businesses in the area that are repaying previous SBA disaster loans also may be eligible for a deferment, on a case-by-case basis. For information on seeking a disaster loan deferment, call the SBA's Disaster Customer Service Center at (800) 659-2955.

Eligible small businesses include small businesses engaged in shrimping, crabbing and oyster fishing in the waters affected by the closure (employees or crew members are not small businesses and are not eligible); small businesses dependent on the catching or sale of shrimp, crabs and oysters, suppliers of fishing gear and fuel; docks, boatyards, processors, wholesalers, shippers, retailers and other small businesses dependent on revenue from fishing, recreational and sports fishing small businesses, and coastal small businesses.

For business owners who are unable to visit a center, they may obtain loan information and application forms by calling SBA's Customer Service Center at (800) 659-2955, or (800) 877-8339 for the hearing impaired, e-mailing
disastercustomerservice@sba.gov, or by visiting SBA's website at www.sba.gov/services/disasterassistance. They may also apply online using the Electronic Loan Application (ELA) via SBA's secure website at https://disasterloan.sba.gov/ela.

The deadline to apply for these loans is February 7, 2011.