The hamlet business district on East Hartsdale Avenue was awash with electrical contractors last week and a Consolidated Edison inspector went door to door among Hartsdale merchants checking on power hookups as Phil Benincasa sorted through a pile of clothes for temporary outsourcing in his unlit dry-cleaning shop. A yellow laundry cart blocked the open front door.
Like most businesses on the west side of the street across from the Metro-North train station, King-Aristocrat Cleaners, owned by Benincasa and his son, Phil Jr., still was closed to customers and without power more than four weeks after the disastrous flood.
One of the street”™s two banks, the HSBC branch was permanently closed as a result of flood damage. HSBC officials had transferred customer records to their Scarsdale branch and safe deposit boxes to the HSBC Central Avenue office in Yonkers.
At Harry”™s of Hartsdale, the upscale restaurant whose owner, Steven Palm, sank $1 million into its opening last year, yanked out electrical wiring dangled from the red-brick front. A banner announced a June 1 grand opening there.
With their power restored, four of the 13 flooded businesses along the street had reopened. Lia”™s restaurant is expected to open soon. A next-door business neighbor of the New York Sports Club said the fitness gym, which drew pedestrian traffic to the block, would be closed for another three months.
At Cross Westchester Cleaners, manager John Wells sat outdoors in the spring sun awaiting customer drop-offs. The shop was without power and closed but owner Mark Gomez was processing cleaning orders from his other two stores, Wells said.
Still, business was not good ”“ “about 40 percent of what it was” before the flood, Wells said.
“Just like opening another new store,” Wells said of the certifications needed to reopen after the flood. “That”™s what it is. Someone”™s got to come inspect the building. Someone”™s got to inspect the wiring.”
At King-Aristocrat, Phil Benincasa was “unofficially” open, he said discreetly. Despite the town building inspector”™s “no occupancy” notice posted on the front door, tagged and bagged garments awaiting delivery filled racks.
“I have a friend helping me off-site” with dry cleaning, he said. To keep their customers, Benincasa and his son, Phil Jr., were offering free pickup and delivery.
Their losses from the flood? “Between loss of business and supplies and equipment, I”™d say $150,000 to $200,000,” Phil Sr. said.
Theirs was among 739 businesses that, as of May 13, had registered with the Federal Emergency Management Agency as flood victims within the 16 counties in New York and contiguous counties in Connecticut, Massachusetts and New Jersey declared eligible for various forms of federal disaster relief. Benincasa said he was in the process of applying for a business disaster loan from the U.S. Small Business Administration.
Few apply for loans
As lender of last resort, the SBA loans money directly from the U.S. Treasury to businesses for uncompensated physical loss as well as economic injury. Loans can be up to $1.5 million with terms of up to 30 years. Interest rates range from 4 percent to 8 percent, with most loans offered at 4 percent, according to an SBA official.
Insurance does not have to be settled before the loan process is completed. There is no application charge, closing costs or other fees from SBA.
Yet only 31 of the business owners registered with FEMA, or 5 percent, have applied for disaster loans, said SBA spokesman Carl W. Schiller. In Westchester County, the SBA as of early last week had approved $873,600 in loans to businesses.
At the Westchester Small Business Development Center”™s Mercy College outreach office, which assists business owners in applying for disaster loans, only two businesses have applied, said business adviser Anthony Presti. Those were Harry”™s of Hartsdale and a Mamaroneck marketing company, he said.
“We have not been overwhelmed with applicants, to say the least,” Presti said.
With a five-month moratorium on repayment, “It”™s actually a very good program,” he said. “The paperwork is not that burdensome. We can help people with the process.”
The business application is a two-page form and takes about 15 minutes to complete, said SBA spokesman Schiller. Business owners also need copies of the last three years of tax returns, current financial statements and monthly revenue estimates over the last three years.
“In Hartsdale, there was resistance to the loans,” Presti said. “A lot of times, small businesses don”™t want to take on more debt. Either they don”™t want to, or they can”™t.”
”˜Piling on debt”™
At Hartsdale Wines and Liquors, owner Robert Troy screwed down plywood panels over a buckled wooden floor on his first full day back in business. “I sell wine; I”™m not really a carpenter,” he said.
Troy estimated his flood losses at $50,000 to $150,000. “The economic loss is bizarre,” he said. “You”™re talking about a minimum of $2,500 a day, and you”™re out of business for 27 days.”
The wine shop owner said he had not decided whether to apply for the SBA disaster loan.
“It”™s not really that promising,” he said. “Most of the storeowners on the street are up to their ears in loans. It”™s just piling on debt.”
“The environmental cleanup guy, the pumping, the electrician and all that stuff, they don”™t wait for you to get your claim back,” he said.
In the village of Mamaroneck, most businesses along flood-ravaged Mamaroneck Avenue have reopened. Business owners there too were skeptical about the federal government”™s disaster loans.
“There”™s a lot of people applying, but I haven”™t heard anybody who”™s happy with the process,” said Deputy Mayor Anthony Fava, whose All State Insurance business on the avenue was closed for three weeks. “First of all, three weeks have gone by. At this point, there needs to be a process that”™s immediate.”
As a flood victim, “I”™m not applying for anything,” Fava said. “I don”™t like the process. It”™s too complicated, it”™s too long and it”™s too bureaucratic.
“What are they going to do, they”™re going to lend me money,” he said. “Anyone will lend me money. I can get a home equity loan if I need to.”
Still suffering
In Mamaroneck last week, maritime machinist Anthony Catanese, whose home and business were heavily damaged in the flood, began circulating a petition among other small-business owners that asks FEMA to assist them with more than low-interest loans.
“Grants are needed to clean and repair the essential equipment required to keep our businesses alive and our employees working,” the petition reads. It asks that businesses be treated equally with homeowners, who are eligible for FEMA disaster relief grants.
On Mamaroneck Avenue as on East Hartsdale Avenue, owners said their business districts had not regained the customers whom flooding drove away.
“People develop habits,” said Troy at Hartsdale Wines and Liquors. “After a month of going to another shop, that”™s all she wrote. They remember East Hartsdale as a thing of the past.”
Both he and Benincasa pointed to the stores across East Hartsdale Avenue that sustained no physical damage in the flood but are reeling too from the economic loss in its wake.
“All the stores across the street are suffering too because everyone thinks the whole town is closed,” Benincasa said.
“This brought attention to the town. I wouldn”™t say notorious, but it”™s the down side of being known.”
To advertise the avenue”™s revival, “Maybe when we”™re all open, we can hold a block party or something,” Phil Benincasa said. Then he went back to work in his closed shop.
FACT BOX:
What: Small Business Administration low-interest loans of up to $1.5 million for businesses claiming flood damage between April 14 and April 18.
Where: Apply online at www.sba.gov/disaster or visit the SBA Business Assistance Center, Village of Mamaroneck Office, 123 Mamaroneck Ave. Hours are 8:30 a.m. to 5 p.m. weekdays.
When: Application deadline for business physical disaster loans is June 25. Deadline for economic injury disaster loans, which provide working capital to small businesses, is Jan. 24, 2008.
