Luzerne County Flood Recovery Program Update
Following the September 2011 Flood, the number one need of the nearly two-hundred Luzerne County businesses struggling to recover from September’s flooding was financial assistance. Businesses needed funds to pay clean-up bills, buy inventory, and make payroll. Without available capital, many small businesses could have faced the difficult choice of taking on high-interest debt to rebuild or to close permanently.
Facing an already sluggish economy, with an unemployment rate among the highest in the state, Luzerne County businesses were in a seriously disadvantaged position to rebuild. While the U.S. Small Business Administration was the primary financial assistance program available to flood-damaged businesses at the time, the SBA’s interest rate of 4%, approval criteria, and turn-around time proved too difficult for many small businesses impacted by the flood.
Luzerne County businesses needed financial assistance with terms that were as flexible as possible, to get them back on their feet. These small businesses were displaced (or their customers were displaced), creating a need for technical and administrative assistance. Many SBA disaster recovery efforts suggested that there was a small window of opportunity for a business to re-open following a natural disaster. Beyond that time frame, many businesses could have failed to ever re-open again.
Announced in November 2011, the purpose of the program was to prevent further job losses and business closings by making financial and administrative assistance readily available to Luzerne County businesses.
This program uses the strengths of the existing public-private capacity to deliver business assistance throughout Luzerne County and offer immediate low-cost recovery capital, skilled economic developers, private-sector advisors, and access to other capital sources. The plan was designed to assist flood-affected businesses in their time of need, while simultaneously bolstering the vulnerable local economy. To date the loans have helped retain 185 jobs in the flood affected areas.
Businesses who received Loans:
CEFALO AND ASSOCIATES
FAMILY DENTAL AND HYGIENE CENTER
BONE AND JOINT ASSOCIATES OF WB, INC.
CSH WATERFRONT, INC.
RANDALL SWANK — PRUDENTIAL
JANET’S TOTAL APPEARANCE SALON
CHUCK’S AUCTION SERVICES
CREST QUALITY CLEANERS
The Program: The Commonwealth Financing Authority approved a $4 million Luzerne County Small Business Loan Fund through a $4 million grant award of Luzerne County Local Share Account funds.
The Luzerne County Business Flood Recovery Loan Program is used exclusively for flood impacted businesses for the first twelve (12) months of operation. The programs then evolves into a permanent market driven loan program focused on creating perpetual economic development opportunities in Luzerne County once the immediate need of assisting business impacted by flooding has abated.
Borrowing limit: $100,000
Borrowing term: 60 months (first 6 months interest-only)
Borrowing rate: 1%
Borrower’s fees: No cost (capitalized with grant funds)
Loan Program Administration:
Businesses interested in applying for the Luzerne County Small Business Loan Fund should contact Metro Action at 570-342-7711 or 570-341-0270.
Metro Action works with the Greater Wilkes-Barre Industrial Fund, Greater Hazleton CANDO, Greater Pittston Chamber of Commerce and South Valley Chamber of Commerce to administer the loan program.
Applications can be found and filled out at www.metroaction.org