Recognizing the widespread economic impact of the Sept. 11 terrorist attacks, the U.S. Small Business Administration this week extended a disaster loan program to small businesses in Monmouth County and throughout the country.
The Economic Injury Disaster Loan (EIDL) program, which will make low-interest loans to businesses suffering economic injury as a direct result of the attacks on New York and the Pentagon, was initially available only to small businesses located in communities designated as disaster areas by the federal government.
These included New York City and adjacent counties in New Jersey, Connecticut, Pennsylvania and Massachusetts, Arlington County in Virginia, Maryland and the District of Columbia.
While Monmouth County was not designated a disaster area, the SBA’s Newark Office and local business groups encouraged local businesses adversely impacted by the disaster to notify the agency’s regional Disaster Area 1 Office in Niagara Falls, N.Y.
"We had about 30 small businesses from Monmouth County tell us they were suffering economic injury because of the World Trade Center disaster," Carl Gaspari, spokesman for the SBA Disaster Office, told Greater Media Newspapers.
"It’s really across the board," Gaspari said of the types of businesses reporting difficulty. "We’ve heard from limousine services, travel agencies, retailers, restaurants and service-oriented businesses like consultants."
Similar reports resulted in the SBA taking the unprecedented action of authorizing EIDL assistance to businesses across the country that have sustained substantial economic injury as a direct result of the terrorist attacks or federal action taken directly after.
The loan program will provide small businesses that qualify for aid with working capital to pay routine operating expenses, and obligations they are unable to pay or meet because of the attacks or the military activation of a key employee.
As spelled out by the SBA, to be eligible for funds, a small business will have to establish that it: was located in an airport or other facility that was closed; supplied or provided services to a business located in or near the WTC or Pentagon; supplied or provided services to a business or industry adversely affected by the terrorist attacks or federal action; is dependent on a business that was closed or suspended operations due to those factors.
The loans are intended only to tide businesses over the period until their operations return to normal. The funds come with the proviso that they are not intended to replace lost income, profits or losses due to an economic downturn and cannot be used to refinance long-term debt or to expand a business.
Eligible small businesses can apply for loans up to $1.5 million to pay fixed expenses like debts, payroll and accounts payable. The loans will have a 4-percent interest rate with a maximum term of 30 years, and businesses have until Jan. 21 to apply. Decisions on applications will be made in one to three weeks.
The SBA will determine the amount of economic injury, the term of each loan and payment amount based on information provided.
"We’ll look at the business history, trends immediately before the disaster, what the business is doing now, and at projections for the next three to six months," Gaspari said, explaining some of the criteria SBA officials will examine to determine eligibility and amounts of loans. "We will gauge what the needs are to keep them operational until they can return to a reasonably normal state."
Businesses will be able to apply for additional funding if necessary, he further explained.
"We can re-evaluate the situation and give increases based on their actual needs as they move forward," he added.
For more information, call the SBA Disaster Area 1 Office at (800) 659-2055.