Clarification: SBA Drought Loans

Only smaller growing operations will be eligible for federal disaster assistance loans through the U.S. Small Business Administration (SBA).

A representative of Farm Credit Service in Central Florida brought this to our attention and we contacted SBA’s office of disaster assistance to find out more details.

Where the confusion comes is the definition of the word, "nursery." Retail nursery functions are covered but in most cases, growers are referred to Farm Service Agency for disaster assistance. By law, agricultural enterprises, such as farmers and ranchers are not eligible for SBA assistance. But according to SBA, nurseries are eligible for economic injury caused by declared drought disasters.

For a wholesale growing operation to be eligible for the SBA loan of up to $1.5 million, the operation must meet small business standards—100 employees or less and net sales of no more than $750,000.

Greenhouse Grower’s Editor Delilah Onofrey spoke with D. Jelani Miller, public information officer for SBA’s office of disaster assistance in Atlanta, Ga. She asked, "What if I have a greenhouse operation with $700,000 in net sales and I produce and sell all of my plants for other retailers, like independent garden centers and small supermarkets? Would I be eligible?"

Miller said, "Under this scenario, you would be a nursery but would still be eligible because you are under the $750,000."

For more information related to the eligibility of your particular operation, contact SBA’s customer service center at 800-659-2955. You can also download the form at www.sba.gov/services/disasterassistance. Drought declarations are by county. Check to see if your county is affected at www.sba.gov/services/disasterassistance