Those Hurt by the S.C. Drought Might Receive Federal Financial Help

By Lauren Markoe

WASHINGTON - Small businesses in South Carolina suffering under a four-year drought could see some financial relief under a bill filed this week in the U.S. Senate.

Farmers affected by drought can apply to the U.S. Department of Agriculture for disaster loans because U.S. Secretary of Agriculture Ann Veneman has declared South Carolina a drought disaster area.

But similar loans aren't available to nonfarm businesses struggling to make ends meet in the face of the dry spellthe roadside restaurant, for example, that has lost farming customers. "Small businesses in South Carolina are facing tough times because of the terrible drought," said U.S. Sen. Fritz Hollings, D-S.C. "If these businesses didn't have it bad enough, they also are now falling through the cracks of federal assistance programs because of a quirk in the law.

"Right now, small businesses hurt by floods, fires or hurricanes can get federal assistance through the Small Business Administration but not those hit by droughts. That rule does no good to businesses that need aid now."

A bill filed this week by U.S. Sen. John Kerry, D-Mass., and co-sponsored by Hollings, would allow loans for such businesses in more than 30 drought-afflicted states through the Small Business Administration.

"If this bill is closing a loophole, it would be a good targeted relief program," said Deb Woolley, vice president of the S.C. Chamber of Commerce. "The drought is having a major effect on everyone, and it's magnified with small businesses."

South Carolina is enduring its worst drought since 1986, and the forecast is for even more dry weather. If no relief comes, the entire state could face mandatory water restrictions by the end of the month, state officials predicted earlier this week.

Gov. Jim Hodges on Wednesday launched a "drought tour" of the state to draw attention to the plight of those most affected by the lack of rain.

The Senate bill doesn't specify how much money would be available to drought-stricken small businesses or exactly which businesses would qualify.Frank Knapp, executive director of the S.C. Small Business Chamber of Commerce, said the aid is badly needed and that he hopes the federal government isn't too strict about deciding which small businesses can get the low-interest loans.

"Hopefully it will be available to small business, in general, who are affected by a downturn in the local economy due to drought," Knapp said.

Kerry, chairman of the Senate Committee on Small Business and Entrepreneurship, sent a letter Wednesday to President Bush asking him to help speed the bill through Congress so relief can be sent to states within the next few weeks.

The senator, who is considering a presidential run, wants the money for his drought-afflicted Massachusetts constituents. But the loans also would help business owners in South Carolina and several other states with early presidential primaries.

U.S. Sen. Fritz Hollings, D-S.C., was an early co-sponsor of the legislation, which so far has the support of five other senators. Hollings could not be reached for comment.