SBA offers disaster loans to Mississippi businesses hit by drought
Mississippi businesses and nonprofits hit by drought can seek SBA loans up to $2 million, with a Feb. 1, 2027 deadline and no payments for 12 months.
Mississippi small businesses and private nonprofits now have a federal cash-flow backstop after the U.S. Small Business Administration opened low-interest disaster loans for losses tied to a drought that began April 14. The declaration covers Bolivar County and 18 other counties, a wide Delta and central Mississippi swath that includes places such as Mound Bayou, Shaw and Rosedale, where thin margins can turn a slow season into a payroll problem fast.
For Cleveland County lenders, accountants, farm-related suppliers and nonprofits that do business across the state line, the practical lesson is simple: drought damage is not limited to fields. The SBA said economic injury disaster loans can go to eligible small businesses, small agricultural cooperatives, nurseries and most private nonprofits, including faith-based organizations, even if they suffered no physical damage. The agency said the money can be used as working capital to cover fixed debts, payroll, accounts payable and other bills that could not be paid because of the disaster.
The loans are not open to agricultural producers, farmers or ranchers, except for aquaculture enterprises. That distinction matters in a region where a feed dealer, church ministry, corner store or trucking company can lose revenue when drought hits surrounding farm income. SBA also said loss of expected profits alone does not count as substantial economic injury, so applicants will need to show the effect on regular operating expenses and cash flow, not just a weaker sales forecast.
The terms are designed to keep businesses afloat while conditions recover. Loans can be as large as $2 million, with rates as low as 4% for small businesses and 3.625% for private nonprofits. Terms can run up to 30 years, and no interest accrues and no payments are due for the first 12 months after the initial disbursement. Economic injury applications must be returned by Feb. 1, 2027.
Chris Stallings, an SBA associate administrator, said the agency is “pleased to offer loans to small businesses and private nonprofits impacted by these disasters,” and noted that the aid comes through a declaration by the U.S. Secretary of Agriculture. The timing fits a wider pattern: the USDA Farm Service Agency issued a separate natural disaster designation June 10 for four Mississippi counties and Mobile County, Alabama, and Mississippi Agriculture Commissioner Andy Gipson said April 23 that 21 Mississippi counties had already been named primary disaster areas because of the drought.
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