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FOR IMMEDIATE RELEASE
May 27, 2010
Contact: Christina Stephens, christina.stephens@la.gov

State of Louisiana Launches Recovery Loan Program for Storm-Impacted Businesses, Communities

BATON ROUGE, La. - The state of Louisiana has launched the Project-Based Recovery Opportunity Program, the first in a series of economic development programs that will provide up to $45 million to address unmet business recovery needs and boost continued economic recovery and revitalization from hurricanes Katrina, Rita, Gustav and Ike.

PROP will provide direct low-interest loans ranging from $500,000 to $5 million at a minimum one percent annual interest rate to eligible businesses in the 20 parishes impacted by hurricanes Katrina and Rita.

Louisiana Recovery Authority-Office of Community Development Executive Director Robin Keegan said, "The ongoing need for economic recovery from the destructive effects of four storms within three years has been compounded by the recent national credit crisis. PROP is the first in a selection of programs aimed at boosting private investment and economic innovation in our storm-impacted economies."

Funding for the program comes from Community Development Block Grant dollars provided by the U.S. Department of Housing and Urban Development for recovery from hurricanes Katrina and Rita. Additional economic development programs to include the Gustav and Ike-affected parishes will follow in the coming months.
Eligible businesses include for-profit and non-profit companies, community development financial institutions or community-based economic development organizations.

To be eligible, businesses must be located in at least one of the following parishes: Acadia, Allen, Beauregard, Calcasieu, Cameron, Iberia, Jefferson, Jefferson Davis, Lafourche, Orleans, Plaquemines, St. Bernard, St. Charles, St. John the Baptist, St. Mary, St. Tammany, Tangipahoa, Terrebonne, Vermilion or Washington.

By using disaster recovery resources to leverage private resources, PROP will encourage investment in commercial corridor revitalization, support key local and state industry sectors, spur long-term job creation and help neighborhoods achieve their economic development priorities.

To be considered for funding, projects must meet all of the following criteria:

  • Establish a new business location or expand a current location in an eligible parish, with expansion defined as improvements to facilities, operations or personnel;
  • Create a minimum number of jobs per project as determined by industry standards;
  • Show minimum annual gross revenue of $250,000;
  • Must have a private investment of at least 10 percent of total project costs; and
  • Limit CDBG funding through this program to 75 percent or less of total project costs; previous Business Recovery Grant and Loan awards are not considered.

Additional consideration will be given to projects that: create opportunities for new small businesses, or for those at least 51 percent owned by a female or minority; preserve historic structures; provide an essential service to a recovering neighborhood; can demonstrate community support; create jobs above the program-required minimum for workers with lower incomes; or have a positive repayment history with the LRA-OCD.

PROP builds on the two successful earlier phases of the Business Recovery Grant and Loan program. Created in February 2007, Phase I of the BRGL provided more than $85 million in grants and interest-free loans to more than 3,600 small businesses impacted by Katrina and Rita. Eligibility for the program was expanded in 2008 during Phase II, which provided an additional $62.5 million in grants and loans to more than 770 severely impacted businesses.

PROP program guidelines and application can be found online at http://www.doa.louisiana.gov/cdbg/dr/DRprop.htm.

For more information about the Project-Based Recovery Opportunity Program, please contact the Louisiana Recovery Authority at (504) 556-9793.

Created in the aftermath of Hurricane Katrina and Hurricane Rita in 2005, the Louisiana Recovery Authority (LRA) is the coordinating and planning body leading the most extensive rebuilding effort in American history. The central point for hurricane recovery in Louisiana, the LRA works closely with the Governor's Office of Homeland Security and Emergency Preparedness (GOHSEP) and partners with state and federal agencies to oversee more than $20 billion worth of programs, speed the pace of rebuilding, remove hurdles and red tape and ensure that Louisiana recovers safer and stronger than before.

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