Disaster Assistance

Following a federally declared disaster in the U.S. Virgin Islands, the U.S. Small Business Administration (SBA) is the primary source of federal assistance for small businesses seeking to recover and rebuild. SBA Disaster Loans are low-interest, long-term funds designed to help businesses, private non-profits, homeowners, and renters recover costs not covered by insurance or other means.

Types of SBA Disaster Loans for Businesses

The SBA offers two main types of disaster loans for businesses and private non-profit organizations:

Business Physical Disaster Loans 

• Purpose: To repair or replace disaster-damaged property.

• What it Covers: Real estate, machinery, equipment, fixtures, inventory, and leasehold improvements.

• Mitigation: You may be eligible for an increase of up to 20% of the verified physical damage to make improvements that protect your property from future damage (e.g., hurricane shutters, reinforced roofs).

Economic Injury Disaster Loans (EIDL) 

• Purpose: To help meet working capital needs and ordinary operating expenses that could have been met had the disaster not occurred.

• What it Covers: Fixed debts, payroll, accounts payable, and other bills that can’t be paid due to the disaster’s economic impact.

• Key Feature: EIDLs are available even if the business did not suffer physical damage, but instead experienced economic loss due to the disaster (e.g., tourism drop-off, supply chain interruption).

Note: A business may be eligible for both a Physical Damage Loan and an EIDL, up to a statutory maximum.

General Loan Terms and Conditions

SBA Disaster Loans are intended to make recovery affordable. While terms are determined on a case-by-case basis, generally:

• Loan Amounts: Up to $2 million for businesses for physical damage and economic injury (combined).

• Interest Rates: Low, statutory rates set by the federal government (historically around 4% for businesses and lower for non-profits).

• Repayment Terms: Up to 30 years to ensure payments are manageable.

• Collateral: Collateral is required for loans over a specific limit (e.g., $25,000 for EIDL). The SBA will not decline a loan for lack of collateral, but will require the borrower to pledge available assets.

• Insurance: By law, applicants are required to obtain and maintain appropriate flood insurance if their damaged or collateral property is located in a Special Flood Hazard Area.

How to Apply for SBA Disaster Assistance in the USVI

The application process officially begins once a presidential or SBA Administrator disaster declaration is issued for the USVI (St. Thomas, St. John, St. Croix, and Water Island).