Economic injury loans available for working capital needs
WASHINGTON — The U.S. Small Business Administration (SBA) announced low interest federal disaster loans are now available to small businesses and private nonprofit (PNP) organizations in Louisiana who sustained economic losses caused by the Smitty’s Supply Fire occurring Aug. 22-25. The SBA issued a disaster declaration in response to a request received from Gov. Jeff Landry on Sept. 3.
The disaster declaration covers the Louisiana parishes of Jefferson, Livingston, St. Charles, St. Helena, St. John the Baptist, St. Tammany, Tangipahoa and Washington as well as the Mississippi counties of Amite and Pike.
Under this declaration, SBA’s Economic Injury Disaster Loan (EIDL)program is available to eligible businesses, small agricultural cooperatives, nurseries, and PNPs including faith-based organizations with financial losses directly related to this disaster. The SBA is unable to provide disaster loans to agricultural producers, farmers, or ranchers, except for aquaculture enterprises.
EIDLs are for working capital needs caused by the disaster and are available even if the business did not suffer any physical damage. They may be used to pay fixed debts, payroll, accounts payable and other bills that could have been paid had the disaster not occurred.
“SBA loans help eligible small businesses and private nonprofits cover operating expenses after a disaster, which is crucial for their recovery,” said Chris Stallings, associate administrator of the Office of Disaster Recovery and Resilience at the SBA. “These loans not only help business owners get back on their feet but also play a key role in sustaining local economies in the aftermath of a disaster.”
The loan amount can be up to $2 million with interest rates as low as 4% for small businesses and 3.625% for PNPs with terms up to 30 years. Interest does not accrue, and payments are not due until 12 months from the date of the first loan disbursement. The SBA sets loan amounts and terms based on each applicant’s financial condition.