SBA Offers Disaster Loans to Texas Small Businesses Affected by Drought

Small nonfarm businesses in 14 Texas counties can now apply for low-interest federal disaster loans. The U.S. Small Business Administration (SBA) announced this opportunity to support those affected by a drought that began on March 12. Francisco Sánchez Jr., associate administrator for the Office of Disaster Recovery and Resilience, highlighted the availability of these loans to offset economic losses from reduced revenues.
Eligible Counties
The loans are available to businesses in the following primary counties:

Edwards
Kinney
Maverick
Val Verde

Neighboring counties also eligible include:

Crockett
Dimmit
Kerr
Kimble
Real
Sutton
Terrell
Uvalde
Webb
Zavala

“SBA eligibility covers both the economic impacts on businesses dependent on farmers and ranchers that have suffered agricultural production losses caused by the disaster and businesses directly impacted by the disaster,” Sánchez said.
Small nonfarm businesses, small agricultural cooperatives, small aquaculture businesses, and most private nonprofit organizations may qualify. These entities can apply for Economic Injury Disaster Loans (EIDL) of up to $2 million. The loans are designed to help meet financial obligations and operating expenses that could have been met if the disaster had not occurred.
“Eligibility for these loans is based on the financial impact of the disaster only and not on any actual property damage. These loans have an interest rate of 4 percent for businesses and 3.25 percent for private nonprofit organizations, a maximum term of 30 years, and are available to small businesses and most private nonprofits without the financial ability to offset the adverse impact without hardship” Sánchez explained.
Interest on these loans does not begin to accrue until 12 months from the date of the initial loan disbursement. Repayment of the SBA disaster loan also begins 12 months from the date of the first disbursement.
The SBA provides EIDLs when the U.S. Secretary of Agriculture designates an agricultural disaster. This designation was made on May 8. However, businesses primarily engaged in farming or ranching are not eligible for SBA disaster assistance. These agricultural enterprises should contact the Farm Services Agency for assistance through the U.S. Department of Agriculture. Notably, nurseries are eligible for SBA disaster assistance in drought situations.
Application Process and Deadline
Applicants may apply online and find more disaster assistance information at SBA’s disaster assistance page . For additional support, applicants can call SBA’s Customer Service Center at (800) 659-2955 or email [email protected] . For those who are deaf, hard of hearing, or have a speech disability, telecommunications relay services are available by dialing 7-1-1.
The deadline to apply for economic injury is January 8, 2025. Small businesses and nonprofits in the affected Texas counties are encouraged to apply promptly to take advantage of this financial assistance.
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This article, " SBA Offers Disaster Loans to Texas Small Businesses Affected by Drought " was first published on Small Business Trends