Louisiana Floods Cause $2B In Damage To Businesses

Louisiana Economic Development estimates the August Louisiana flood caused $8.7 billion in damage to Louisiana residential and commercial properties, with damage to businesses in the state exceeding $2 billion. Those figures do not include damage to the state's public infrastructure.

LED commissioned economist Dek Terrell of Lewis Terrell and Associates LLC to conduct the damage assessment in support of efforts by Gov. John Bel Edwards to gain federal appropriations from Congress. Those appropriations would be in addition to Louisiana recovery efforts being led by FEMA, the U.S. Small Business Administration and other federal, state and local agencies. Gov. Edwards is seeking $2 billion that would be delivered as disaster assistance through Community Development Block Grants managed by the federal Department of Housing and Urban Development.

In addition to an estimated 109,000 housing units damaged, nearly 20,000 Louisiana businesses were interrupted by the flooding that began Aug. 11 and continued for days, leading to the flooding of more than 6,000 businesses in 22 affected parishes. LED also surveyed 455 economic driver firms in flood-impacted regions – those employers that contribute the most output to the state's economy – and found that 6 percent suffered significant damage while 9 percent sustained minor damage.

"The good news we want to project is that most of our major industries in Louisiana remained open and today are continuing their operations successfully," LED Secretary Don Pierson said.

Nevertheless, the flooding of housing inventory – affecting three of every four homes in Livingston Parish, for example – combined with damage to schools, businesses, churches and public infrastructure to disrupt daily life for hundreds of thousands of people. At peak, LED estimates that 278,500 Louisiana residents were unable to work due to temporary closures, suspension of operations, transportation impasses and residential flooding. Many of those residents continue to seek assistance through FEMA, SBA and contractors as they rebuild their lives.

Pierson said. "Our friends, families and colleagues, including many in our own department, are doing the difficult work of rebuilding their lives and we are doing everything we can to support them. That support extends to our vital small business community. We are delivering more resources and assistance to them daily and will stand by them as they reopen their firms and restore the critically important framework of our small business economy. Small businesses are big business in our state, representing more than 97 percent of all Louisiana business establishments and more than half of our private-sector workforce."

LED is providing a complete resource guide for flood assistance at OpportunityLouisiana.com.

Included in that effort are seven Business Recovery Centers opened in flood-impacted regions in conjunction with SBA and the Louisiana Small Business Development Center Network.

SBA is leading efforts to provide disaster loan assistance to homeowners, businesses of all sizes and many nonprofit organizations. The LSBDC Network is providing guidance to help small business owners plan and implement their recovery. Together, they've visited more than 2,200 individuals through Business Recovery Center outreach in Louisiana, with nearly 50,000 calls fielded by SBA customer service representatives and SBA loan approvals to date reaching more than $236 million. FEMA has disbursed more than $505 million in individual assistance to help residents who were uninsured or underinsured for flood losses. The National Flood Insurance Program, managed by FEMA, has authorized more than $274 million in flood insurance claims to date in the state.

On Friday, FEMA surpassed $1 billion in total federal assistance to Louisiana disaster survivors and communities, less than 30 days after the flooding event began. More than 63,000 Louisiana families are receiving housing-related assistance through federal programs.

Secretary Pierson said federal, state and local partners have risen to the occasion to provide a concerted, strong response, but Louisiana's recovery needs remain great. As part of a comprehensive request for $2 billion in additional flood disaster assistance from Congress, LED hopes to secure more resources to provide bridge funding and infrastructure resources that will restore Louisiana businesses.

"Our view is fixed on long-term solutions that will sustain Louisiana's impacted businesses," Pierson said, "not only to help them renovate their damaged structures, not only to help them reopen their doors, but to regenerate the working capital and revenue they need to survive this disaster and to become healthy contributors to Louisiana's economic success far into the future."