By MJ Plaster
The disasters keep rolling in—one right after the other. Unpredictable weather is one of the things Americans have learned to live with. It’s when, not if, a natural disaster or a wind-fueled wildfire will strike. As a business owner, you want to protect inventory, physical buildings, data, employees and office pets.
I’ve been through more natural disasters than I care to remember, including Tennessee’s Thousand-Year Flood in 2010 when my home sustained six feet of gushing water. I lived to tell the story and worked my way through the labyrinth of complex forms, organizations, qualifications, etc., the hard way. Now that I’ve earned the t-shirt, I’ll share what I’ve learned.
First Steps After the Disaster
There’s so much to do, you’ll be overwhelmed at first. It’s difficult to know where to start. You want to attack the list in the right order, and get professional help for tasks beyond your pay grade.
Safety is your only immediate consideration. The safety of you and your employees, not to mention your family, are more important than your business. Things can be replaced, and businesses can be rebuilt. Life is irreplaceable; it’s once and done! Keep everyone safe and worry about the business later.
Play the Waiting Game
Wait until the authorities clear your area for re-entry before checking your workplace for damage. You have no way of knowing the conditions en route to your business—live, downed electrical lines; impassable roads, toxic chemicals; raw sewage; and wildlife such as alligators and snakes. Earthquakes spawn aftershocks, and winds can re-ignite wildfires. Your life could depend on your patience.
Text messages are your best bet for contacting others before power and communications are restored. The occasional text message will slip through. Internet, landline, and cell phone service will be spotty to non-existent. Once communications are restored, you will still have trouble getting calls through because everyone will be placing calls at once.
While you play the waiting game, contact your insurance company. If you don’t have a copy of your policy, request an email copy because mail service will be non-existent in some areas. Flood and earthquake insurance are separate policies, not covered under your general business insurance. FEMA underwrites flood insurance, but your insurance agent sells it. In hard-hit areas, FEMA won’t have enough adjustment agents to handle all claims promptly, so ask your insurance agent if he or she can handle it.
Make an extensive list of everything you’ve lost while you’re waiting to get back into your place of business. Once you’re in, retrieve any available receipts. Contact vendors for copies of missing receipts. You must be able to prove (to varying degrees) your losses to receive reimbursement.
The Federal Emergency Management Agency (FEMA) does not offer grants to businesses or farms. However, if you do not have flood insurance, you may qualify for a FEMA grant for your primary residence. FEMA representatives will be everywhere to offer assistance.
SBA and FSA Loans and Grants
If you are located in a declared disaster area, the Small Business Administration (SBA) offers low-interest disaster loans to businesses and homeowners. The SBA site says, “SBA disaster loans can be used to repair or replace the following items damaged or destroyed in a declared disaster: real estate, personal property, machinery and equipment, and inventory and business assets.” Use your wait time to apply for an SBA loan if money is an issue. Even if money is not an issue right now, consider applying for a loan. When grants become available, the organization extending the grant usually wants to see SBA loan paperwork before you can apply for a grant. This sounds counterintuitive, but SBA paperwork opens doors that otherwise remain locked—even for homeowners.
If you own a farm, the Farm Service Agency is your go-to destination for disaster assistance and loans.
You need to address smoke removal and black mold immediately. Stay away from stairs until a professional verifies their integrity, and if the ceiling’s integrity is in question, get out. Unless you’re qualified, leave smoke and mold removal, structural, and electrical, plumbing and equipment repairs to the pros.
Get up and Running
Even if your workplace needs repairs, your business doesn’t have to come to a grinding halt.
- Set up support staff to work remotely.
- If you have a showroom, a call center, etc., look for temporary accommodations. Do this quickly because you won’t be the only business owner who needs an alternate space.
- Negotiate payments and terms with your landlord, vendors and utility companies, especially with internet providers.
- Some professionals, such as accountants, can work out of their homes, and they’ll see increased business due to casualty losses.
- If your business operates as a team, you can still work remotely and collaboratively using apps and internet tools. You might find that you work just as well remotely without expensive overhead costs.
- Contact your customers and explain to them how you will conduct business in the interim.
- If you can’t fulfill your customers’ needs for the duration of your recovery, tell them the truth. They will appreciate your honesty, and they will sympathize with you. They might be in the same situation, in which case your delay might not be an issue. Offer alternate solutions, if possible. You will gain respect as well as a grateful customer.
Network, Network, Network
I can’t stress this enough. I’m not a “meeting” person, but I found local meetings to be extremely helpful. This is where the money spigots open, and you will find out about unadvertised grants. You’ll also make new contacts and friends with whom to exchange important information during the recovery period.
Money is available to help you, but you have to venture beyond the internet to find it. You have to show up—in person. Much of the available money is time limited. You might hear about a $1,000 gift card for a big-box home improvement or business supply store with only a week’s window to apply. You need to have eyes and ears everywhere, and you have to be quick to grab the money that’s falling from the sky. The spigots open and close with lightning speed. Once you’ve scored your share, spread the word to everyone. Money adds up quickly—$10,000 here, $5,000 there, $20,000 from another source, etc. Keep digging; the well is deep, and someone is going to take it.
Casualty-Loss Tax Deductions
The IRS offers generous casualty loss deductions on personal and business taxes. The rules change from year to year. Sometimes, they differ from disaster to disaster. The reporting is complicated, so you’ll need to work with a CPA or tax preparer.
A Final Note
Entrepreneurs take pride in their self-reliance. You may find it difficult to accept help in the form of grants or even a meal from a restaurant that comes through the neighborhood with food and water. Just because there are others who are in worse condition than you are, there’s no guarantee that if you avoid taking aid it will go those in dire need. Learn to accept help gracefully. That was the hardest adjustment in thinking I had to make. Remember that your tax dollars help to fund most, if not all, of the organizations that are making grants or otherwise extending a hand.
You have contributed to your community, and now your community is there for you. You’ll have plenty of time after you’re back on your feet to pay it forward to someone in need; and believe me, you will be the first to offer a helping hand when the time comes.
Next month, we’re going to post a detailed disaster preparation checklist for businesses to help you prepare in advance for any future disasters. Stay tuned.