Business flood recovery to get $85 million boost from state

Four new disaster assistance programs unveiled by state officials here Thursday will help businesses cover everything from lost rent to disaster loan interest.

Iowa Governor Chet Culver said the programs, expected to cost $85 million, will “fill in the gaps” left by previous programs to help businesses affected by the worst disaster in state history.

The programs are the:

• Business Rental Assistance Program expansion. The previos business rental assistance program provided up to $50,000 to help flood-affected businesses offset rental lease payments for up to six months. The program was expanded to allow eligible businesses to use portions of the funding not needed for rent to cover damaged machinery, office equipment, supplies and other equipment.

• Loan Interest Expense Program. The program provides up to $50,000 in funds to cover interest expense on disaster loans needed by affected businesses for loan repayment periods of up to three years.

• Commercial Rental Income Gap Program. The program provides commercial landlords with funds to offset rent lost when properties became unusable due to the disaster, up toa total of $25,000 per unit.

• Residential Landlord Business Support Program. The program provides residental landlords owning housing that meets affordable housing guidelines to claim up to $15,000 for lost rental income because the affordable rental units became unusable due to the disaster.

Standing near a flood-wrecked escalator in the Town Centre building, Culver said “the people of Cedar Rapids have been and continue to be severely tested by the impact of last year's floods.” He said the state worked closely with city and Cedar Rapids business leaders to come up with the programs, but it was a challenge to make them fit the requirements of the federal Community Development Program that provided the money to the state.

The programs address some shortcomings in previous disaster programs that have been raised repeatedly with city officials and lawmakers. Flood-affected businesses have complained loudly that they need funds they don't have to repay, because they were already carrying heavy debt loads before taking on flood recovery debt.

“It's free money, which is finally what we needed,” said Steve Emerson, who has taken on about $3 million in debt to restore about 10 downtown office buildings he owns that flooded.

Emerson said he won't qualify for funds to restore the Town Centre building where the announcement took place because he was not the owner when it flooded. Emerson does expect to qualify for about $350,000 under the new programs for his other downtown buildings.

Cedar Rapids Mayor Kay Halloran said working out the expanded disaster provisions with the state took a long time because of the difficulty of matching the needs to the categories federal CDBG program, which was not designed for disaster recovery. She said the final outcome will be a big help, adding that she only wished separate federal legislation could have been enacted pecifically to meet the needs of Iowa's disaster.