{
  "id": "R45554",
  "type": "CRS Report",
  "typeId": "REPORTS",
  "number": "R45554",
  "active": true,
  "source": "EveryCRSReport.com",
  "versions": [
    {
      "source": "EveryCRSReport.com",
      "id": 592786,
      "date": "2019-02-26",
      "retrieved": "2019-12-20T19:53:27.569278",
      "title": "Considerations for Implementing a Small Business Disaster Grant Program",
      "summary": "Throughout the years, Congress has expressed interest and concern for businesses recovering from disasters. For nearly a century, the federal government\u2019s policy for providing disaster assistance to businesses has been limited primarily to low interest loans rather than grant assistance. More recently, Congress has contemplated whether grants should be made available to small businesses after a major disaster. During this debate, some have questioned why small businesses are not eligible for disaster grants when residences, nonprofit groups, and state and local governments are eligible. In addition to concerns about equity, proponents of small business disaster grants argue that small businesses should be eligible for grant assistance because of the important role they play in the national economy. Major disasters can severely disrupt economic activity by causing immediate losses of output, income, and employment. While reports vary on the number of small businesses that fail after a disaster, even the low estimates could be considered significant. The Institute for Business and Home Safety found that 25% of businesses that close following a disaster fail to reopen, and a study on businesses in New Orleans recovering from Hurricane Katrina found that 12% of businesses remained closed 26 months after the storm. The number of failing businesses after a disaster reported by Federal Emergency Management Agency (FEMA) are higher. According to FEMA, \u201croughly 40%-60% of small businesses never reopen their doors following a disaster.\u201d\nTo some, these findings suggest that the federal government should play a greater role in business disaster recovery. As part of this expanded role, Congress could consider providing grants to businesses to help them rebuild and recover from disasters. Changing the federal government\u2019s approach to business disaster policy, however, could be complex and require some careful decisionmaking. Steps would need to be taken to avoid and remedy potential grant and loan duplication. Congress would also have to determine under what circumstances and situations the grant program would be put into effect. Eligibility requirements would need to be developed to determine under what situations and circumstances grants would be provided as well as what types of businesses should be eligible to receive grants. Similarly, Congress might consider whether grants could be used for rebuilding, mitigation, or economic loss, in addition to other recovery activities. In addition to these concerns and others, Congress may want to investigate the potential cost implications of a small business disaster grant program. \nThis report examines the historical development of federal disaster assistance to help explain possible reasons why businesses are currently provided disaster loans rather than grants. This is followed by a discussion of policy considerations and options related to a potential disaster grant program for small businesses, including\nhow to minimize duplication of operations and benefits;\nwhether to authorize the program in the Small Business Act, the Stafford Act, or other statute;\nthe potential cost implications of a small business disaster grant program; and\neligibility requirements (such as business size standards, eligible activities, and grant award amounts).\nAlternatively, Congress could explore other policy options to support small businesses struggling to recover from a disaster, including\nloan forgiveness;\ndecreased interest rates; and\nestablishing programs to help small (and large) businesses develop disaster and business continuity plans.",
      "type": "CRS Report",
      "typeId": "REPORTS",
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      "topics": [
        {
          "source": "IBCList",
          "id": 4832,
          "name": "Small Business"
        },
        {
          "source": "IBCList",
          "id": 4845,
          "name": "Federal Emergency Management"
        }
      ]
    }
  ],
  "topics": [
    "American Law",
    "Economic Policy"
  ]
}