The U.S. Small Business Administration (SBA) has announced the availability of low-interest federal disaster loans to assist small businesses and private nonprofit organizations in Texas affected by the drought that began on November 1, 2024.
According to the SBA, the disaster declaration encompasses numerous counties across Texas, including Andrews, Bexar, Denton, El Paso, and Travis, among others. The declaration also covers counties in New Mexico and Oklahoma, extending the relief's reach to businesses and nonprofits in those areas.
Under this declaration, the SBA's Economic Injury Disaster Loan (EIDL) program is accessible to small businesses, small agricultural cooperatives, nurseries, and private nonprofits that have incurred financial losses directly tied to the drought. However, the SBA clarifies that it cannot provide these disaster loans to agricultural producers, farmers, or ranchers, except for small aquaculture enterprises.
"EIDLs are aimed at addressing working capital needs resulting from the disaster," the SBA stated, adding that businesses can access these loans even if they did not suffer any physical damage. Eligible uses for the funds include covering fixed debts, payroll, and other bills that remain unpaid due to the economic impact of the drought.
Chris Stallings, associate administrator of the Office of Disaster Recovery and Resilience at the SBA, said, "Through a declaration by the U.S. Secretary of Agriculture, SBA provides critical financial assistance to help communities recover. We’re pleased to offer loans to small businesses and private nonprofits impacted by these disasters."
The SBA outlines that the loan amount can reach up to $2 million with interest rates of 4% for small businesses and 3.625% for private nonprofits, with repayment terms extending up to 30 years. Notably, interest does not accrue, and payments do not commence until 12 months following the first loan disbursement. The SBA determines loan amounts and terms based on the financial condition of each applicant.
Potential applicants are encouraged to apply online at sba.gov/disaster. Alternatively, they may contact SBA’s Customer Service Center at (800) 659-2955 or email disastercustomerservice@sba.gov for further information. Individuals who are deaf, hard of hearing, or have a speech disability can access telecommunications relay services by dialing 7-1-1.
The deadline for submitting completed loan applications to the SBA is November 25.
Providing a backbone of support, the U.S. Small Business Administration asserts its commitment to empowering small business owners and recovering communities through its extensive network of field offices and partnerships.