Oct. 24, 2001 – The federal Small Business Administration's Economic Injury Disaster Loan program, announced Friday [see "V.I. firms may be able to get SBA disaster loans"], has the potential to bail out businesses hurt by the post-Sept. 11 downturn in the island's tourism-based economy.
But few people contacted on Wednesday by the Source knew anything about it.
"We have not been authorized to do any publicity," explained Calford Martin, who manages the SBA office on St. Thomas.
Apparently, no publicity from the Niagara Falls-based SBA regional office is heading this way either. A press release from Delegate Donna Christian Christensen on Friday appears to have been the only outreach to make residents aware of the program's existence.
Many local business owners already are familiar with the nature of SBA disaster loans, having been through the application process in the aftermath of Hurricanes Hugo, Marilyn and Bertha, all of which prompted the declaring of federal disasters in the territory.
Mark Sperber, owner of Mile Mark Watersports on St. Croix, was thrilled to hear about the program available now from a reporter."Where can I sign up?" he asked.
He said that business is very slow, and a loan would help ensure that he'll still be in business next year and the year after. "It's necessary for small businesses," he said.
The program lends up to $1.5 million at 4 percent interest. The maximum time to repay it is 30 years. Loans over $5,000 must be secured. Of course, the SBA will decide how much an applicant can get and for how long. "We make a determination as to your credit worthiness and your ability to repay," said Carl Caspari, SBA spokesman at the Niagara Falls office.
Applications must be received there by Jan. 21, 2002.
Eustace Grant, president of the V.I. Taxi Association on St. Thomas, had a vague recollection that he had heard something about it. After learning more, he said he would put up posters so his drivers would have the information. "Many are suffering," he said.
He said the taxi drivers who work out of Cyril E. King Airport were the hardest hit when the number of arriving tourists dropped dramatically after the terrorist attacks of Sept. 11.
Mary Davis, who with her husband, Frank, owns the 15-room Danish Chalet Inn on St. Thomas, also was in the dark. "We still have some to pay from Hurricanes Hugo and Marilyn," she said, referring to earlier SBA disaster loans used to repair the inn.
Davis said it won't be necessary to borrow money to stay afloat immediately because they make ends meet during the slow fall months each year with the deposits that come in to reserve bookings for the upcoming winter. However, with the territory's entire winter season in a holding pattern, she admitted to being concerned about any further terrorist attacks.
Kate Campbell, owner of the Pink Papaya gift shop in Cruz Bay, also worries that another attack would keep people away. However, she said she would rethink her business plan rather than borrow money to stay in business. "The only way I would borrow was if I saw a light at the end of the tunnel," she said.
At the moment, Campbell does not see any light at the end of the terrorism situation. "This could be a long, drawn-out thing," she said. Businesses try to build up a rainy-day fund to tide them over during economic hard times, she said, but locally, by the time the slower summer and fall season is over, the fund from the previous season is about used up.
For details about the federal disaster loan program, visit the SBA web site. To request a loan application, call the SBA at 1-800-659-2955.
