SBA hurricane loans top $710 million mark

“SBA’s disaster office is producing unprecedented results in response to the unprecedented circumstances caused by Hurricanes Katrina, Rita and Wilma,” said SBA Administrator Hector V. Barreto, in a Dec. 2 news release. “We have received more disaster loan applications in 12 weeks than we received for any other disaster in the history of the agency, and we are approving loans at a steadily increasing rate.”

Through Nov. 21, the SBA approved more than 10,200 long-term disaster recovery loans for homeowners, renters and businesses, for a total of $710.6 million. “We are maintaining the integrity of the process, protecting taxpayers’ interests and meeting the needs of those so brutally hurt by the hurricanes,” Barreto said.

Barreto noted that only two previous disasters in history led to more than $1 billion in SBA loans: the Northridge earthquake in 1994 and the multiple hurricanes that struck Florida last year.

“This year’s catastrophic hurricanes left a disaster area … the size of Great Britain,” Barreto said. “Nearly 250,000 people were displaced to locations in all 50 states; more than 200,000 homes were destroyed and another 45,000 are unlivable; of the 190,000 small businesses in Louisiana, about 81,000 are eligible for federal assistance.”

The SBA’s Office of Disaster Assistance has grown from 880 staff before Katrina struck to more than 4,170, and more are being hired every day. Almost two-thirds of SBA’s 6,286 employees are working seven days a week, 18 hours a day to handle the demand for loans, Barreto said.

The SBA has taken a number of steps to ease the process, expand capacity to

process loans and provide other sources of capital for small businesses. Those efforts include launching an effort to get money to small businesses in the affected area more quickly through the Go Loans program, which allows SBA lenders to make SBA-guaranteed loans of up to $150,000 to small businesses that need cash for working capital more quickly than the disaster loan program is designed to provide.

In the area of contracting, the SBA and other federal agencies have worked hard to see that small businesses, and particularly local small businesses, get a share of the contracts for clean-up and rebuilding after the hurricanes. Small businesses have received 45 percent of clean-up and rebuilding contracts in the affected areas, according to the release.