GOVERNOR CULVER ANNOUNCES NEW DISASTER ASSISTANCE PROGRAMS
DES MOINES – Governor Chet Culver today announced four new disaster assistance programs for small businesses and landlords impacted by the 2008 storms and floods, as well as improvements to the duplication of benefits policy for homeowners, at a press conference in Cedar Rapids.
The new business assistance programs will be funded by $85 million of the state's nearly $800 million in Community Development Block Grant (CDBG) funds from the U.S. Department of Housing and Urban Development (HUD).
“It gives me great pleasure to say we have additional assistance for Iowa's hard-working small business owners and landlords,” Governor Culver said. “As the state of Iowa continues to recover from one of the largest natural disasters in U.S. history, more help is now available to those trying to keep their doors open for business. We believe the programs announced today will fill a gap that currently exists.”
The Iowa Department of Economic Development (IDED) and Rebuild Iowa Office (RIO) worked closely with business leaders and landlords across the state to develop the following programs, which will assist with remaining unmet needs:
Business Rental Assistance Program:
This program is for businesses remaining in or locating in rental space that was physically damaged by the 2008 natural disasters. Initially, this program allowed business owners up to $50,000 to help offset building rental lease payments for a maximum of six months. Now in addition to rental payments, recipients will be allowed to use the $50,000 for expenses associated with replacing damaged machinery, office furniture, supplies and other equipment. The maximum award a business can receive through this program is $50,000.
Loan Interest Expense Program:
The continued existence of many businesses is threatened by the expense of new debt acquired as a result of the disasters. This program provides funds to business owners to pay for the interest on an SBA or private loan for disaster recovery. Up to a total of $50,000 in funds will be provided to a business, for a maximum of three (3) years.
Commercial Rental Income Gap Program:
This program is designed to assist with cash flow for commercial building owners to offset lost revenue from vacant rental space that was physically damaged by the disaster. A maximum of $25,000 for lost rent will be reimbursed to commercial landlords per unit.
Residential Landlord Business Support Program:
This program is designed to compensate disaster-impacted residential landlords providing affordable housing for lost rental income. Landlords may receive up to $15,000 per business impacted by the disaster.
One application will be available for all of these programs. Funds will be awarded on a first-come, first-served basis. Small business owners and landlords should apply at their local Council of Government or Entitlement City. Applications will be available by December in most locations.
At today's press conference, Governor Culver also announced improvements to the housing duplication of benefits policy. When the Jumpstart Housing program was first announced, any type of down payment assistance – or award a homeowner received to purchase a replacement house – was considered a bridge loan, meaning eventually the money had to be repaid after a buyout took place.
After long conversations with the U.S. Department of Housing and Urban Development, the State has finally received approval for Iowans who received state or federal assistance through the Jumpstart program to keep up to $25,000 of their down payment assistance award towards a replacement or newly constructed home. Up to $25,000 of this money will no longer be deducted from a person's buyout funds.
"The average price of a home in a buyout as a result of the 2008 disasters costs much less than the average price of a home sold in Iowa today, leaving people with a gap that we need to help fill," said Governor Culver. "By allowing homeowners to keep up to $25,000 toward a new home, we can help meet that need."
The Governor also encouraged impacted Iowans who are in a buyout and have identified a replacement home to apply for down payment assistance at their local Council of Government or Entitlement City as soon as possible, if they haven't done so already. Depending on their income, homeowners may qualify for down payment assistance, which can then be used toward the purchase of a replacement home.
For additional information on these programs or for a listing of area Council of Governments or Entitlement Cities, log on to the Rebuild Iowa Office Web site at www.rio.iowa.gov or call (515) 242-5004.