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Dr. Richard Halling watched from home as the floodwaters rose along Cypress Creek.
He knew his office, off of Treaschwig Road just across the street from the bloated creek, would flood. He was right. More than 3 feet of water filled the dentist's office, which contained hundreds of thousands of dollars in medical equipment. Like many others in the area, he has no flood insurance.
Halling is one of more than 170 businesses in the community forced to close down either temporarily or permanently after the Lake Houston area was devastated by Hurricane Harvey.
He and dozens of others packed into a conference room at the Lake Houston area Chamber of Commerce on Wednesday to learn more about their recovery options through the Small Business Administration, Texas Workforce Solutions and Small Business Development Center.
Flores said he's been on the ground for 51 disasters in the past 10 years. He emphasized already SBA has approved $143 million in disaster loans in the first two weeks after the flooding, and the first week doesn't count because the government is still in response mode. That number will go up exponentially in the next two months, he said.
The SBA approved more than $1.25 billion in disaster loans after disastrous flooding in Louisiana last year, and Harvey appears to have done worse to Texas, Flores said.
"What we're looking at is we're trying to get you back to the day before the storm of where you were," Flores said. "We can't make you better, but we can try and make you whole. That's what this is about."
Everyone affected should register with the Federal Emergency Management Agency as well as the SBA, Flores said. FEMA can provide grants up to $33,000 for homeowners who need a jump-start on repairs. However, Flores said, FEMA does not provide long-term recovery. That help comes through the SBA, which assists homeowners, renters businesses and private nonprofits.
Residents can apply online at sba.gov/harvey or visit a disaster recovery center or business recovery center. A disaster recovery center features both FEMA and SBA, while the business recovery center hosts just the SBA. There is a 60-day window to ask for help from the federal government and that ends Oct. 24.
"Even if you don't think you need a loan, apply anyway," Flores said. "You are under no obligation to accept the loan … I don't want anybody in this room to miss out on federal funds available."
Businesses are eligible for a loan up to $2 million amortized over 30 years at a 3.3 percent interest rate. Homeowners are eligible for up to $200,000 for their home and $40,000 for the contents inside at a 1.75 percent rate. And renters are eligible for up to $40,000 at the 1.75 percent rate. The rate for private nonprofits is 2.5 percent.
The first payment will be deferred for six months, Flores said.
SBA also offers an economic injury loan for businesses that didn't not sustain physical damage but were affected by the flooding. For example, he said, if a road was closed and the business can prove in financial statements that its revenue went down because of the flooding, that business could be eligible for a loan to help it recover.
There's no prepayment penalty or fees, Flores said. Insurance does not preclude someone from obtaining a loan, but it is important to document as much as possible.
Flores said there are rumors SBA will not fund landlords or people renting out multiple properties; however, someone with rental properties is considered a business and is eligible for up to a $2 million loan.
Churches, he said, also are eligible for economic injury loans. For example, if their tithes were down because people couldn't attend, that would be a result of the disaster.
"It's going to patchwork of programs that's going to make a homeowner or a business whole, so don't think that 'I just need to go down one avenue. If that doesn't work, then forget about it,'" Flores said. "It's not over - just keep applying."
Right now, he added, it takes about three to four weeks for an application to go all the way through the process. In the first two weeks, FEMA had 720,000 registrations and 420,000 of those were referred to the SBA. Those numbers will only increase, he said.
SBA will not cut a check for the full loan amount. It will give an approved applicant an initial disbursement, and then the applicant can draw down funds as needed, providing receipts and contractor estimates along the way.
Mark Mitchell, president of Lake Houston Economic Development Partnership, encouraged businessowners to consider a federal loan before depleting their children's college funds or refinancing their houses. The rates compared to the market right now, he said, are fantastic.
"I know many people don't want to hear loan, especially businessowners, because you may incur additional debt," Flores said. "Please don't let that deter you. Let's take a look together. We can work through the process, and then you can make a decision because you have 60 days from the time that we take you to approval to make a decision to decide, 'Hey, we want the loan' or 'We only want part of the loan.'
"If you decide not to, that's a personal decision."
Tuesde Cavil, an auditor with the Texas Workforce Commission, said the government offers disaster unemployment assistance for some who wouldn't qualify otherwise for traditional unemployment. For example, she said sole proprietors or the self-employed could be eligible. Unlike traditional unemployment, it does not get charged as a chargeback or increase the business's tax rate, Cavil said.
There is also a shared work program to prevent layoffs if business is slow. If a business must reduce the hours of its employees, the government may be able to make up the difference in lost wages. However, Cavil said, that program would affect the business's tax payment.
For more information or to apply for disaster unemployment, visit ui.texasworkforce.org or call 877-892-3896.
Omar Fortune, who also is a member of Gulf Coast Workforce Board, said their database holds 2,000 jobs related to the disaster to help people who want to return to work. The board also is working to subsidize working opportunities at public businesses, like cities and public nonprofits.
"It will aid people with some immediate income in their pockets, but also the businesses because all of them are swamped right now with claims and referrals and people coming in for services," Fortune said.
There's a lot of help available, according to Miguel Lopez, executive director of the Small Business Development Center at Lone Star College, but nothing is moving fast because of the scope of the disaster.
Think of the SBDC as general business consultants, he said. The center can help businesses come up with a business plan, marketing strategy or a disaster recovery plan. Their services are free and SBDC consultant Jan Koenig recently set up shop out of the Lake Houston area Chamber of Commerce building.
Lopez cited a FEMA statistic that 40 percent of small businesses never reopen their doors after being affected by a disaster, but he challenged the community to defy the odds.
"Y'all are so crucial," Lopez said. "You employ people, pay taxes, people come to you. A lot of folks will go back to being or working in their normal lives, but yet there's going to be so many of us that are not going see a normal week or day for quite some time."
Several times throughout the meeting, Mitchell pointed to the chamber's partnership with Insperity and Humble Area Assistance Ministries to create the Lake Houston area Relief Fund. Insperity has agreed to match donations to the fund up to $1 million.
Jenna Armstrong, president and CEO of the chamber, said not only can people donate to the fund online, but the application also can be filled out at lakehoustonarearelieffund.org. It is open to residents and small businesses, and Armstrong encouraged applicants to send in pictures and document as much as they can. Grants will be approved case-by-case by a committee.
Armstrong also is working with chambers across the country in an office supply drive to aid local businesses. She said a room in the chamber building is open to local businessowners who need internet access or a fax.
There's a spotlight on the community right now, Mitchell said, but "we've responded spectacularly." It's important to emphasize Harvey was a residential storm, severely damaging 122,000 single-family homes and 18,000 apartments, Mitchell said, but there are developments around the area that were not flooded and did not lose power throughout the storm.
"Yes, we did take a hit, but we're open for business," Mitchell said. "We can still bring new business in. We've got areas of the city that were not negatively impacted ... There's another story to be told.
"We just went through the worst storm in recorded history, the worst flooding in recorded history, and we're all sitting here right now talking about recovery."
Source : http://www.chron.com/neighborhood/humble/news/article/Lake-Houston-area-businesses-encouraged-to-apply-12198836.php