President Joe Biden warned that small business disaster loan funding “could run out in a matter of weeks.”
In a letter to Congress on Friday he cautioned that the available funding could run out if Congress does not approve additional federal funds.
The Small Business Administration (SBA) has warned that its disaster loan program could run out of funds by the end of the month, potentially leaving businesses in the wake of Hurricane Helene without financial assistance.
The SBA has been offering disaster loans to help small businesses affected by Hurricane Helene in Florida, Georgia, North Carolina, South Carolina, Tennessee, and Virginia.
The warning comes as Hurricane Milton is set to hit Florida. Forecasts show Milton making landfall in Tampa on Wednesday night or early Thursday morning, with widespread impact expected
The SBA said that it would continue to provide information about its disaster loan programs and assist borrowers with processing and servicing existing loans.
However, without additional funding, new loans could be delayed or put on hold.
“We look forward to working with Congress to secure the federal resources necessary to ensure the SBA can continue funding affordable disaster loans for homeowners, renters, small businesses, and nonprofits,” said SBA Administrator Isabel Casillas Guzman.
“Americans should not have to wait for critical assistance when they need it the most.”
Currently, business owners can apply for two types of disaster loans.
The Business Physical Disaster Loan is intended for repairing or replacing disaster-damaged property, including real estate, inventories, supplies, machinery, and equipment.
The loan is available to businesses of all sizes and nonprofit organizations.
The application deadline is the end of November.
The second scheme is the Economic Injury Disaster Loan (EIDL), which provides working capital to help small businesses, agricultural cooperatives, and private nonprofits cover their financial obligations during the recovery period.
Businesses have until June 30, 2025, to apply for EIDL loans.
Eligible businesses can apply for loans up to $2 million, with interest rates as low as 4% for businesses and 3.25% for nonprofit organizations.
The SBA also offers disaster loans to homeowners for up to $500,000 to repair or replace damaged real estate, while homeowners and renters may apply for up to $100,000 to repair or replace damaged personal property.
In addition to federal assistance, some states are also providing relief. In Florida, the Florida Small Business Emergency Bridge Loan Program has allocated $15 million to assist small businesses impacted by Hurricane Helene.
Eligible businesses can apply for up to $50,000.
This article includes reporting from The Associated Press
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