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Connecticut Small Businesses Eligible for Economic Injury Disaster Loans

In May 2023, frost and freeze caused significant damage to small businesses in Connecticut. To provide assistance, the U.S. Small Business Administration (SBA) has announced the availability of Economic Injury Disaster Loans for the affected businesses.

This loan program was introduced on August 2 to support the recovery of Connecticut’s small business community.

Disaster Declaration

In response to the frost and freeze, the U.S. Department of Agriculture declared an agriculture disaster in all eight counties of Connecticut. The declaration also encompasses selected areas in New York, Massachusetts, and Rhode Island.

Kem Fleming, the director of SBA field operations center east, explained that when the Secretary of Agriculture issues a disaster declaration for farmers, the SBA also provides assistance to eligible entities impacted by the same disaster.

Connecticut Governor Ned Lamont expressed concern about the damages suffered by farmers due to the cold weather event. With the disaster declaration, affected businesses can now seek support.

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Loan Eligibility

These SBA loans are available to farm-related and nonfarm-related entities that have suffered financial losses directly caused by the frost and freeze disaster. Eligible entities include small businesses, small agricultural cooperatives, small aquaculture businesses, and most private nonprofit organizations.

Small businesses impacted by the disaster can apply for loans of up to $2 million through the SBA. The interest rates for small businesses are set at 4%, while private nonprofit organizations have a lower interest rate of 2.375%. Both groups can have loan terms of up to 30 years.

It is important to note that SBA does not provide disaster loans to agricultural producers, farmers, and ranchers. However, these farmers can seek disaster assistance through the Farm Service Agency.

Loan Applications

Small businesses can utilize these loans to cover fixed debts, payroll, accounts payable, and other necessary expenses. However, the loans are not intended to replace lost sales or profits.

To apply for these loans, small businesses can visit the SBA website and search for SBA declaration #18007. Application forms are available online and can also be requested through email or by contacting SBA’s Customer Service Center at 800-659-2955.

The deadline to submit loan applications is March 5, 2024. Small businesses are encouraged to take advantage of this opportunity to recover and rebuild.

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