Small businesses affected by fire eligible for SBA economic injury loans

Filed under: Daily News,Small Business |

Roger Busch, SBA spokesman, and Greg Lopez, SBA Colorado district director, opened the Small Business Disaster Assistance Center at 6840 Centennial Blvd. Hours are 9 a.m. to 6 p.m. Monday-Friday.

In the first week since the SBA Disaster Assistance center opened in Colorado Springs, loan officers fielded about a dozen inquires a day.

Officials at the disaster center, 6840 Centennial Blvd., expect that number to increase as more residents and business owners affected by the Waldo Canyon fire learn about the low-interest, long-term loans available to help them through the rough patch, said Roger Busch, Small Business Administration public information officer.

“When people think of disaster, they think the damage is only physical,” he said.

But, a disaster like the Waldo Canyon fire, which forced the evacuation and closure of businesses for a week along the Garden of the Gods Road corridor, can have long-term economic affects. Businesses could lose customers or suppliers and that could get them into a bind when it comes to making payroll, Busch said.

The U.S. Small Business Administrator declared El Paso and Teller counties as disaster areas. That declaration set into the motion the disaster assistance center and the SBA’s offering of loans to business owners for up $2 million for economic injury.

The loans are not just for businesses located along Garden of the Gods Road, said Greg Lopez, SBA Colorado district director. When disaster hit, small business across the county were affected, he said. The loans also are available to nonprofit organizations.

SBA also has set up a disaster loan center in Larimer County and will help business owners in neighboring counties too, he said.

“Economic injury, it evolves as a business is trying to ascertain whether they are able to carry on,” Lopez said.

Federal disaster loans for businesses are fixed at 4 percent interest rate and could be paid over 30 years. That makes for a low payment, Lopez said. And, the loans are direct loans with SBA, not through a bank, so there are no up-front fees, he said.

“Our focus is to help businesses be successful,” Lopez said.

SBA started its low-interest federal disaster loan program back in 1953. Busch, who has worked at least 90 disaster sites across the country and in U.S. territories, said the business community does take advantage of the program. While up to $2 million could be loaned, most small businesses need about $150,000 to $300,000, he said. Most often, the money is used for cash flow.

“The idea is to get them back to normal,” he said.

The filing deadline to return applications for property damage is Oct. 9.  The deadline to return economic injury applications is May 7, 2013.

For details or to apply for a loan electronically SBA’s disaster website.