FAQ: Disaster Recovery Microloan Program

FAQ: Disaster Recovery Microloan Program

2019-01-11T12:43:38-05:00January 4, 2019|INsource Newsletter|

Soldiers of the 1st Squadron, 105th Cavalry assist local citizens in protecting their homes from additional flooding by building sandbag walls around property during Aug. 24 relief efforts near Tenney Park in Madison. Dane County experienced record rainfall earlier in the week, leading to high water levels in downstream lakes and other bodies of water.

PHOTO: Wisconsin National Guard photo by Staff Sgt. Alex Baum/Flickr

Q: What is the Disaster Recovery Microloan Program?
A: In September 2018, WEDC launched the Disaster Recovery Microloan Program, aimed at providing short-term assistance to businesses affected by disaster events in the state of Wisconsin. The microloans are to assist businesses with necessary restoration and operating expenses until more long-term recovery funding can be secured. This fiscal year, $2 million has been allocated for the program; from this total, WEDC awards grants to its regional partners, which in turn issues loans to businesses.

The WEDC Board of Directors approved the program after businesses and homes in 18 counties were damaged in late August and early September following several weeks of intense storms, tornados and heavy rainfall across much of southern and central Wisconsin. These storms produced devastating flash flooding in multiple regions, resulted in seven dam failures, and caused several lakes and rivers to spill out of their banks and damage homes, bridges and roads. More than 300 businesses statewide sustained nearly $34 million in damage, while more than 1,200 homes sustained more than $25 million in damage, according to Wisconsin Emergency Management.

Q: What are the eligibility requirements?
A: Businesses in all 72 Wisconsin counties are eligible if affected by disasters, either natural or manmade. To qualify, a business must have suffered measurable damage and must intend to resume business operations in the community as soon as possible.

The following businesses are not eligible for microloans: payday loan and title companies, telemarketing businesses other than inbound call centers, pawn shops, liquor stores, adult entertainment venues, home-based businesses and farms.

Q: How much funding is available?
A: Individual businesses may apply for loans of up to $15,000 each through WEDC’s regional partners.

Q: What are the loan terms?
A: The no-interest loans have a two-year repayment period, with payments deferred for at least six months.

Q: What can the funds be used for?
A: The microloans can be used for procurement of cleanup and restoration services, operating expenses such as payroll, temporary space, and repair and reconstruction.

Q: How can businesses apply?
A: The Disaster Recovery Microloan Program is administered through WEDC’s regional partners, which cover all 72 counties. Currently, the program is being deployed with three regional partners in response to the August 2018 flood events. Applications will be accepted by regional partners on an ongoing basis through February 28, 2019.

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January 2019