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SBA Administrator Offers Economic Injury Assistance to Louisiana Small Businesses Affected by Deepwater BP Oil Spill

Release Date: 
Thursday, May 6, 2010
Release Number: 
10-21
Contact: 
Carol Chastang (202) 205-6987

Small businesses can request deferrals on existing SBA disaster loans

WASHINGTON – SBA Administrator Karen Mills announced today the agency is making low-interest loans available to Louisiana Gulf Coast small businesses suffering financial losses following the April 20 Deepwater BP oil spill that shut down commercial and recreational fishing along the state’s southeast coast.

Mills acted under the SBA’s authority to offer economic injury assistance in response to a May 4 request from Gov. Bobby Jindal. Mills’ declaration, signed late yesterday, makes SBA’s Economic Injury Disaster Loans (EIDL) available immediately to help meet the financial needs of qualifying small businesses following the oil spill.

“With the region still recovering from previous devastation and the national recession of the last couple years, it’s 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.

Mills’ 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.

With the EIDL loans, SBA is offering working capital loans of up to $2 million at an interest rate of 4 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. SBA encourages businesses to also file claims with BP. Borrowers may be required to use any claim payments to help repay these SBA loans.

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.

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 who are repaying SBA disaster loans will also 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.

The SBA will announce the location of several Disaster Loan Outreach Centers in the affected communities within the next few days. SBA customer service representatives will be available at each center to meet with business owners to answer questions about the disaster loan program, issue applications and help them complete the forms.

“We will be in Louisiana as long as we are needed and until we get the job done,” Mills said.

Or they may obtain loan information and application forms by either calling SBA’s Customer Service Center at (800) 659-2955 (800-877-8339 for the hearing impaired), e-mailing disastercustomerservice@sba.gov, or visiting SBA’s Web site at www.sba.gov/services/disasterassistance.

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

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Related State: 
Louisiana
Mississippi