Small Businesses in Drought-Affected Regions Urged to Apply for Loans Before Deadline

Francisco Sánchez Jr., the associate administrator for the Office of Disaster Recovery and Resilience at the Small Business Administration (SBA), has reminded small nonfarm businesses across several states of the impending deadline to apply for federal disaster loans. These vital funds are designed to help businesses counter the economic strain caused by severe drought conditions that have plagued various regions since mid-2023.

The SBA’s low-interest Economic Injury Disaster Loans (EIDL) are available to small nonfarm businesses, small agricultural cooperatives, small businesses engaged in aquaculture, and most private nonprofit organizations. These loans aim to provide up to $2 million in working capital to alleviate the financial hardships brought on by reduced revenues due to the drought. The deadline for application submission is April 1, 2024, marking a critical juncture for businesses in need.

The affected areas span across 20 Iowa counties and neighboring counties in Illinois, Minnesota, Missouri, and South Dakota, with primary counties including Cass, Lee, Lyon, and Montgomery in Iowa. Similarly, 10 Missouri counties, notably Grundy and Livingston, and their neighboring regions are eligible for assistance. Montana’s primary counties, Flathead and Lincoln, along with neighboring areas in Montana and Idaho, are also included.

Sánchez emphasized that the EIDLs could be used to cover essential operational costs, such as fixed debts, payroll, and accounts payable, which have become challenging to manage due to the drought’s impact. This assistance extends to businesses indirectly affected by the disaster, such as those reliant on the agricultural sector, highlighting the SBA’s comprehensive approach to disaster recovery.

The loans feature an interest rate of 4 percent for businesses and 2.375 percent for private nonprofit organizations, with repayment terms of up to 30 years. The SBA will determine the loan amounts and terms based on each applicant’s financial condition, ensuring tailored support to meet diverse needs.

It’s crucial for small business owners to recognize that these loans are a direct result of the U.S. Secretary of Agriculture’s agricultural disaster designation, underscoring the government’s recognition of the severe economic fallout from the drought. Notably, businesses primarily engaged in farming or ranching are directed to seek assistance from the Farm Services Agency, with an exception made for nurseries, which qualify for SBA assistance in drought disasters.

Applicants are encouraged to apply online at and can seek further assistance through the SBA’s Customer Service Center. The center offers guidance on the application process and additional disaster assistance information, ensuring that affected businesses have the support they need to navigate this challenging period.

As the deadline approaches, small business owners in the affected regions must act swiftly to secure the financial assistance necessary for their survival and continued operation. The SBA’s disaster loan program represents a critical lifeline, offering hope and practical support to those facing the economic repercussions of the drought.

Image: SBA

1 Comment ▼

Joshua Sophy Joshua Sophy is the Editor at Small Business Trends. A professional journalist with 20 years of experience in traditional media and online media, he attended Waynesburg University and is a member of the Society of Professional Journalists. He has held roles of reporter, editor and publisher, having founded his own local newspaper, the Pottsville Free Press.

One Reaction
  1. What a crucial reminder for small businesses impacted by the ongoing drought across multiple states! Francisco Sánchez Jr.’s emphasis on the impending deadline for federal disaster loans underscores the urgency of the situation. These low-interest Economic Injury Disaster Loans (EIDL) from the SBA are a lifeline for businesses grappling with reduced revenues and financial strain. It’s heartening to see such comprehensive support available, covering essential operational costs and catering to diverse needs. The government’s recognition of the economic fallout and its swift action in providing assistance is commendable. Small business owners in the affected regions should heed this call to action and explore the SBA’s disaster loan program before the April 1st deadline. This initiative represents not just financial aid but also a beacon of hope for those navigating the challenging landscape of drought-induced economic hardship.

Leave a Reply

Your email address will not be published. Required fields are marked *