The Small Business Administration has announced that it has depleted its funding for disaster assistance loans, causing delays in aid for small businesses, homeowners, and renters affected by Hurricanes Helene and Milton. These loans, known as Economic Injury Disaster Loans, are crucial for those impacted by natural disasters. The SBA had previously warned of a potential funding shortage due to the expected increase in claims following Hurricane Helene.
While the SBA has paused new loan offers until additional funding is secured, other disaster relief programs such as those provided by the Federal Emergency Management Agency (FEMA) remain unaffected by the SBA shortfall. Hurricane Helene, a Category 4 storm, wreaked havoc across several states after hitting Florida's Gulf Coast, followed by Hurricane Milton two weeks later.
Despite the funding challenges, the SBA has received over 37,000 applications for relief from Hurricane Helene and made loan offers totaling approximately $48 million. Additionally, around 12,000 applications have been received from those affected by Hurricane Milton. SBA Administrator Isabel Casillas Guzman emphasized the importance of continuing to apply for loans, highlighting the role of financial relief in aiding communities to recover swiftly and stabilize local economies.
House Speaker Mike Johnson has assured strong bipartisan support for providing the necessary funds once Congress reconvenes after the November election. The SBA offers two types of disaster loans: Business Physical Disaster Loans for property repairs and Economic Injury Disaster Loans for working capital needs. Businesses can access loans up to $2 million, with interest rates as low as 4% for businesses and 3.25% for nonprofit organizations.
Homeowners are eligible for disaster loans up to $500,000 for property repairs, while renters and homeowners can receive up to $100,000 for personal property damage. FEMA's disaster relief fund, which covers various disaster response expenses, is currently able to address the aftermath of Hurricanes Helene and Milton. However, FEMA Administrator Deanne Criswell has indicated that supplemental funding from Congress may be necessary in the future.
For more information on government aid programs, individuals can visit disasterassistance.gov.
