SBA issues sheet on loans for those effected by oil spill

Published 8:49 pm Tuesday, August 17, 2010

Congressman Jo Bonner recently announced that The Small Business Administration has issued a fact sheet on economic injury disaster loans for small businesses resulting from the Deepwater BP Oil Spill which occurred April 20 and continues.

This declaration is due to the governor’s certification of economic injury. Mobile and Baldwin Counties in Alabama are eligible for these loans along with Escambia, Clarke, Monroe and Washington Counties in Alabama; Escambia County in Florida; and Greene, Jackson and George Counties in Mississippi.

According to Bonner, this would include those businesses involved in shrimping, crabbing and oyster fishing in the waters affected by the closure of certain areas of the waters. In addition it includes any number of small businesses that are dependent on revenue from fishing, recreational and sports fishing small businesses and coastal small businesses.

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The deadline to apply for this assistance is Feb. 14, 2011.

“I applaud the SBA for approving Governor Riley’s request for these low interest loans for eligible small businesses in Baldwin, Clarke, Escambia, Mobile, Monroe and Washington counties,” Congressman Bonner said. “Alabama’s seafood-dependent small businesses need assurance that they will have the financial resources to withstand a potential prolonged negative economic impact from this unforeseen disaster. The availability of these federal loans affords our small seafood businesses added flexibility to face an uncertain economic climate.”

Economic Injury Disaster Loans (EIDLs) are working capital loans to help small businesses, small agricultural cooperatives and most private, non-profit organizations of all sizes meet their ordinary and necessary financial obligations that cannot be met as a direct result of the disaster. These loans are intended to assist through the disaster recovery period. They are available only to businesses and their owners who cannot provide for their own recovery from non-government sources, as determined by the U.S. Small Business Administration (SBA).

Applicants must have a credit history acceptable to SBA and must show the ability to repay the loan, which is made available at four percent interest, with a total of $2,000,000. Collateral is required for all loans over $5,000, with the term of a maximum for 30 years. Exact term of the loan will be determined by the SBA in accordance with the borrower’s ability to repay. Applicants who have not complied with the terms of previous loans are not eligible. The SBA required borrowers to have appropriate insurance for all loans over $5,000 and maintain insurance for the life of the loan. If it is in a flood zone, a special flood hazard insurance must be maintained for the life of the loan.

The SBA will open local Business Recovery Centers in South Alabama where SBA customer service representatives will personally meet with applicants and answer questions. These locations will be announced soon.

For more information, contact SBA Disaster Assistance Customer Service Center at 800-659-2955 or go online at