SBA Disaster Loan Program Updates

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[Updated October 22, 2016]

The U.S. Small Business Administration is offering disaster assistance to residents of North Carolina affected by Hurricane Matthew, and has provided detailed information for farm-related and non-farm related businesses.

By law, agricultural enterprises are not eligible for disaster assistance from SBA. The law makes SBA disaster loans available to non-farm businesses, private non-profit organizations, homeowners and renters. The law defines ineligible agricultural enterprises as those businesses that are engaged in the production of food and fiber, ranching and raising of livestock, aquaculture (except for economic injury disaster loans), and all other farming and agricultural related industries. This definition is not limited to products for human consumption. Most agricultural enterprises fall into Industry Sector 11 of the North American Industry Classification System (NAICS).

Under section 7(b) of the Small Business Act, SBA may not provide disaster loans to agricultural enterprises. A business may be primarily an agricultural enterprise but also have a non-agricultural, separable component. The non-agricultural venture may be eligible for a business physical disaster loan regardless of the “primary” activity of the overall business structure or affiliated group. To be eligible, the non-agricultural venture must be a separable operation and not just part of the agricultural enterprise, with separable and distinguishable income, operations, expenses, assets, etc.

Aquaculture is included in the statutory definition of an agricultural enterprise, and is ineligible for physical disaster loan assistance, although it may be eligible for EIDL assistance. Aquaculture is defined as the propagation and rearing of aquatic organisms in controlled or selected aquatic environments for any commercial, recreational, or public purpose. An aquaculture operation generally is engaged in husbandry of aquatic organisms on grounds, which the applicant owns, leases, or has an exclusive right to use. Exclusive use-rights are usually documented by a lease or a permit specifically identifying the waters available for the applicant’s use. For example, oystermen who seed private grounds, which they own or rent, are engaged in aquaculture and are ineligible for physical disaster, loan assistance.

SBA regulations define nurseries (nursery farms) as commercial establishments deriving 50 percent or more of their annual receipts from the production and sale of ornamental plants and other nursery products, including, but not limited to, bulbs, florist greens, foliage, flowers, flower and vegetable seeds, shrubbery, and sod. Nursery farms are not eligible for physical disaster loans. For purposes of physical disaster loan eligibility, a business deriving less than 50 percent of annual receipts from the production of nursery products is not an agricultural enterprise and is eligible.

Agricultural cooperative means those cooperatives acting pursuant to the provisions of the Agricultural Marketing Act [12 U.S.C. 114(j)] and Section 3(j) of the Small Business Act. These associations operate for the mutual benefit of the members (producers or purchasers) and conform to a or b and, in all cases, c below:

  1. No member of the association is allowed more than one vote because of the amount of stock or membership capital they may own therein;
  2. The association does not pay dividends on stock or membership capital in excess of 8 percent per annum; and
  3. The association does not deal in farm products, farm supplies, and farm business services with or for nonmembers in an amount greater in value than the total amount of the business transacted with or for members. All business transacted by any cooperative association for or on behalf of the United States or any agency or instrumentality thereof shall be disregarded in determining the volume of member and nonmember business transacted by the association.

A primary residence located on a farm is eligible.

Examples, of eligible farm-related businesses are farm implement dealers or feed and seed retailers.

SBA encourages each business and resident affected by Hurricane Matthew to submit a disaster loan application.

However, farmers and ranchers should contact their local FSA office.

To be considered for all forms of disaster assistance, survivors should register with the Federal Emergency Management Agency (FEMA) at or call the toll-free Helpline at 800-621-3362. Those who use 711-Relay or Video Relay Services should call 800-621-3362 (800-462-7585 TTY).

The SBA offers several ways to apply for a disaster loan: online application via SBA’s secure website at; visit a recovery center for one-one-one assistance; or download an application from

For information or to request application forms, call the SBA’s Customer Service Center at 800-659-2955 (800-877-8339 for the deaf and hard-of-hearing) or send an email to Completed applications should be returned to the center or mailed to: U.S. Small Business Administration, Processing and Disbursement Center, 14925 Kingsport Road, Fort Worth, TX 76155.

Jay MacKenna
Public Affairs Specialist, U.S. Small Business Administration

This data distribution has been determined to contain sensitive or personally identifiable information. As such, the distribution must be protected and managed in accordance with the procedures described in SBA Procedural Notice 9000-1709, available on the SBA website. Individuals in receipt of this data are required to be familiar with the Notice, and to protect and dispose of the data in accordance with its terms. A copy of this advisory, and the deletion deadline must accompany any further distribution of the data.

Written By

Justin Moore, N.C. Cooperative ExtensionJustin MooreDirector of Marketing and Communications, NC State Extension Call Justin Email Justin Extension Administration
NC State Extension, NC State University
Updated on Oct 22, 2016
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