State Road Home starts second round of business recovery program

Louisiana will dole out another $80 million in business loans and grants to small companies struggling to recover from the 2005 hurricanes Katrina and Rita, the second round of such business aid from a pool of federal recovery dollars.

Applications will be accepted for six weeks from June 9 to July 18 for the awards, which will be a 20 percent grant and 80 percent, interest-free loan, according to Louisiana Economic Development, which announced the plans Tuesday.

The awards will range from $20,000 to $100,000 for most eligible businesses, said Michael Hecht, LED director of business assistance.

For a $100,000 award, that would mean a company would receive a $20,000 grant and an $80,000 loan, for example.

Sen. Ann Duplessis, a banker from eastern New Orleans, said the assistance helps storm-damaged businesses pay down other, higher-interest debt and free up dollars to keep themselves operating and rebuilding.

“This program has been such a fabulous program,” she said.

To be eligible, the businesses can’t have more than 100 employees, must have a minimum pre-storm annual gross revenue of $25,000, must be in one of 20 south Louisiana parishes, and must have either sustained a 20 percent revenue loss or a $20,000 asset loss because of the storms.

Businesses won’t have to start repaying their loans for six months, and the loans will be interest-free for two years, with a 4 percent interest rate thereafter. They must be repaid in seven years.

The repayments will be plugged into a revolving loan fund that will be used to help other businesses in later years, said LED Secretary Stephen Moret.

Officials said they hope to give grants and loans to more than 1,500 businesses in this second round of the program.

Hecht said the state last year doled out about $100 million in grants and loans.

About 3,500 businesses received grants averaging $18,000 each, while more than 300 companies received loans averaging $93,000 each, he said.

Forty-three percent of the aid went to New Orleans businesses.

Hecht said the eligibility criteria was broadened to allow more companies to participate.

“There were some worthy businesses that were not able to participate” in the first round, he said.

Businesses that received a grant in the first round of awards only can receive a loan this time, rather than the loan and grant mix.

More information is available by visiting www.Louisiana-Forward. com or by calling 1-877-610-3533.