Small Businesses Say Federal-Disaster Aid Needs Strengthening

Small Businesses Say Federal-Disaster Aid Needs Strengthening

Small businesses are those that are owned and operated by an individual or a group of people which are limited in size and the income generated depends on the business (Ruth, S & Joseph De Avila, 2017). Small businesses are faced with various challenges such as flood occurrence whereby, they may end up closing their businesses or taking a long time to re-establish that particular business due to lack of finance. This is because the majority of the people who run small businesses in most cases do not qualify for loans and therefore, any kind of disaster which may occur might not be reconstructed due to limited savings as loans are offered in accordance to one’s savings. Some individuals may opt to use their savings to reconstruct the destruction caused by any kind of the disaster. This is because they fear debts and interests associated with loans. Thus, they may have a reduced level of standard of living on spending the little they had.

The U.S. Small business administration’s program is the main source of federal aid for flood-ravaged entrepreneurs. It enables businesses to acquire loans of up to 2 million dollars to reconstruct any destruction although, more than half of the loan applications are usually rejected due to lack of enough cash to repay the loan in their accounts (Ruth, S & Joseph De Avila, 2017). This, therefore, is a disadvantage to some individuals who had a dream of achieving more in life through running that particular business. The U.S. small business administration’s program should offer loans to all without counter checking on one’s account since some may be a beginners. Instead, the administration should give them a particular period of repayment depending on individual’s amount of loan offered. This will greatly contribute economically and also in an individual’s life as all can run their businesses even after the disaster.

The mismatch between federal assistance and small business needs is another challenge affecting such firms. Usually, small businesses operate with small amounts putting aside some small amounts to cover them in case of any disaster occurrence (Ruth & Joseph, 2017). Therefore, if any disaster occurs, the only amount secured will be paid by the federal assistance with the rest amount of damage beyond being left behind. The business thus, may not fully be recovered if the owner of the business does not have any money to fully rebuild his or her business. Also, despite the higher probability of flood occurrence from Hurricane Harvey, Katrina, Irma and Maria, many small businesses have no flood insurance and some who have that insurance says it is not adequate. This is in the case where all losses resulting from flooding may not be covered in case they are beyond what an individual has insured.

The Federal government has not yet come up with a plan on ways and means of assisting small businesses operators in solving any problem facing them. According to Sen. Jim Risch who is the chairman of the Senate committee on small business and entrepreneurship, an audit should be carried out on the SBA’s response to loan issuance and any other kind of assistance (Ruth, S & Joseph De Avila, 2017). SBA’s and other sources of funding should often offer loans to individuals who operate small businesses even when their income does not qualify them. A number may be beginners but should offer that loan in an exchange with a security worth the amount such as a title deed and therefore offering them opportunity to a better life through success of their business.

Ruth, S & Joseph De Avila, (2017). Disaster Aid Needs Strengthening. Lawmakers Press. Retrieved from

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