Small business owners in southwest Florida counties are weighing financial options for recovery following Hurricane Ian. For some, the path forward is to take out a special disaster loan from the U.S. Small Business Administration.
Vlad Moise, who owns a Sarasota-based woodworking supply shop, is hoping to borrow at least $10,000 to offset his estimated loss of revenue from the late Sept. storm.
“Fortunately, we didn’t have any physical damage, but our sales definitely hurt,” he said. “And talking to other business owners, I think that a lot of people are in the same situation.”
For operations that were spared from physical damages by Ian but still suffered a financial hit, business owners can apply for an SBA-backed economic injury disaster loan. Business locations that experienced on-site damages can also apply for a business physical disaster loan.
The combined total for approved economic injury and physical disaster loans reached $1 billion, as of Nov. 23, with a total of 14,049 physical damage and 261 economic injury loans approved by the federal agency.
Borrowers in the greater Tampa Bay region and nearby counties account for nearly $900 million in lending, as of Nov. 25, with Lee County small businesses borrowing more than $500 million alone.
Behind Lee, Collier, and Charlotte counties, Sarasota County business owners have the next highest number of approved borrowers for disaster recovery.
Activated by a presidential emergency declaration, the deadline for physical damage loans was extended to Jan. 12, alongside other extensions for FEMA assistance. The State of Florida and FEMA have also opened 28 Disaster Recovery Centers to connect residents to resources.
Toussaint said the window for economic injury loan applications – in particular – is purposefully long because it requires time for business owners to collect evidence of financial impacts.
Therefore, winning approval for economic injury loans is more difficult than being approved to borrow money for physical damages. Touissant said that’s why the number of borrowers approved for economic injury is trailing far behind those claiming physical damages.
Moise said that in addition to closing his doors during Ian, his woodworking supply shop has been particularly challenged by the climbing cost of construction materials and supply chain disruptions.
And even if he’s approved for an economic injury loan, he’s not sure that would address the bigger economic challenges he’s facing.
Aileen Cangelosi, who runs Ace Plumbing, Inc. with her husband in Venice, said that they’re unsure they would borrow the money even if they’re approved.
She said that for small operations like theirs, taking out a disaster recovery loan can be a risky financial decision.
The family-owned plumbing company celebrated 50 years in business in September. The Cangelosi’s have managed the business since 2005 when the previous owners retired.
“We do everything from unblocking the sink to re-piping your home,” she said. They serve long-term, sometimes multi-generational, residential, and commercial clients spanning from Manatee to Charlotte counties.
This time of year, business is usually booming, she said. Like many businesses in Southwest Florida, Ace Plumbing, Inc., depends on the flurry of tourists in the winter and spring. But this year, Cangelosi said, they won’t have that benefit.
In the two weeks following Ian, from Sept. 29 to Oct. 15, Cangelosi said they suffered a 60 percent loss in revenue compared to the same time last year. Of their six-person staff, they’ve had to furlough four employees.
She’s hesitant to incur future expenses, like monthly loan repayments, until she’s the certain business will bounce back next quarter.
That prospect is made more uncertain by those in her community struggling to make ends meet. She said many of their clients are making tough decisions between home repairs and paying their bills.
“Everyone is trying to economize basically with the holidays right upon us,” she said.Source: WFSU