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FFC Tapped to Manage Tornado Bridge Loans

Feb 2007

In response to damage from the recent central Florida tornados, the State of Florida has implemented a Disaster Bridge Loan program for affected small businesses. Once again, the Governor's Office has turned to FFCFC to administer the program.

Governor Charlie Crist activated Florida's Small Business Emergency Bridge Loan Program to provide emergency, short-term loans to businesses in Volusia County severely impacted by the tornadoes that struck Central Florida on February 2, 2007. Upon assessment, other counties may also be eligible for emergency bridge loans.

The short-term loans are intended to “bridge the gap” between the time a major catastrophe hits and when a business has secured other resources, including profits from a revived business, payment of insurance claims or longer-term loans.

“The recent tornadoes impacted countless people in Central Florida,” said Governor Crist. “In Volusia County, several small business sustained measurable damage. Quick revitalization of these businesses is an imperative part of the state's recovery.”

The Florida Small Business Emergency Bridge Loan Program provides a source of expedient cash flow to businesses physically damaged during a major catastrophe. These short-term loans enable businesses to quickly begin repairs and replace destroyed inventory.

“Offering an immediate source of cash flow allows impacted businesses to quickly re-open their doors,” said Governor Crist. “I am grateful to the Florida Legislature for quickly and thoughtfully requesting this funding to aid recovery efforts.”

The Governor has allocated $1 million from General Revenue to fund the bridge loan program to be administered by Florida First Capital. The appropriation is made through a budget amendment pursuant to the Governor's emergency declaration.

The program was first activated in the aftermath of Hurricane Andrew in an effort to provide short-term emergency funding to businesses in need of immediate cash flow. Since then, the program has minimized the economic impacts of the Winter Storm of 1993, the Northwest Florida Floods of 1994, and Hurricanes Opal, Georges, Charley, Frances, Ivan, Jeanne, Dennis and Wilma.

Short-term loans of up to $25,000 will be available to owners of small businesses (less than 100 employees) in those counties impacted by the tornadoes. The interest-free loans come in terms of 90-day or 180-day maturities. To be eligible, a business owner must have been operational for one full year prior to February 2, 2007, and have verifiable, physical damage to their business.

A five-member committee comprised of three local bankers, one community representative and one representative from Enterprise Florida, Inc., or the Governor's Office of Tourism, Trade, and Economic Development (OTTED) reviews applications for approval. Loans are usually processed in three to five days.

Applications for Volusia County businesses will be available Friday, February 9, 2007. To receive an application or more information on the program, please contact the Governor's Office of Tourism, Trade, and Economic Development at (850) 487-2568, or the local economic development office in Volusia County:

Richard Michael, Director, Economic Development

Phone: 386-248-8048, Fax: 386-248-8037

E-mail: rmichael@co.volusia.fl.us

Web Site: www.floridabusiness.org