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Oklahoma Cooperative Extension Services
The Oklahoma SBDC at Oklahoma Cooperative Extension Services offices provides entrepreneurs with professional business consulting at no cost, management training, and vital information they need to grow and succeed in a complex and competitive global environment.
Take care of yourself first
You have just been through a disaster that has turned your life upside down. A disaster can do damage beyond the obvious physical destruction. The hidden enemy could be emotional stress and anxiety. Stay calm and collected and remember that cooler heads will prevail in times of adversity. The Red Cross and FEMA suggest the following steps you can make to relieve any tensions or stress:
- Discuss and communicate your problems
- Rest often and eat well
- Set a manageable schedule
- Watch for signs of stress
- Seek help if you cannot shake feelings of anxiety or stress
The damage to your business or property from a disaster can cause various potential dangers to your health. The building’s foundation could have become weakened, the electrical system may have shorted out and flooding or rain may have left behind things that can make you very sick. For these reasons, you should avoid the cleanup unless you know what you are doing or until you know it is safe to do so.
FEMA and the Red Cross suggest that infants, pregnant women and people with health problems should avoid the damaged or flooded property until cleanup is complete. In addition, confirm that the water is safe at your property before you drink it or wash anything with it.
The following are some recommended procedures from the Department of Labor to keep you safe and healthy if you attempt cleanup efforts yourself:
- Take frequent rest breaks when lifting heavy objects. Avoid overexertion, and practice good lifting techniques. To help prevent injury, use teams of two or more to move bulky objects; avoid lifting any materials that weigh more than 50 pounds per person, and use proper automated lifting assistance devices if practical.
- When working in hot environments, have plenty of drinking water available, use sunscreen and take frequent rest breaks. Wear light-colored, loose-fitting clothing.
- Be sure a first-aid kit is available to disinfect any cuts or abrasions. Protect open cuts and abrasions with waterproof gloves or dressings.
- Wash your hands often during the day, especially before eating, drinking or applying cosmetics.
- Use a wooden stick or pole to check flooded areas for pits, holes and protruding objects before entering.
- Ensure that all ladders and scaffolds are properly secured prior to use.
- Conduct a preliminary worksite inspection to verify stability before entering a flooded or formerly flooded building or before operating vehicles over roadways or surfaces. Don’t work in or around any flood-damaged building until it has been examined and certified as safe for work by a registered professional engineer or architect.
- Washouts, trenches, excavations and gullies must be supported or their stability verified prior to worker entry. All trenches should be supported (e.g., with a trench box). If no support is available, the trench must be sloped at no less than a 1:1 (45°) angle for cohesive soil and 1:1½ (34°) angle for granular soils including gravel, sand and loamy sand or submerged soil or soil from which water is freely seeping.
- Establish a plan for contacting medical personnel in the event of an emergency.
- Report any obvious hazards (downed power lines, frayed electric wires, gas leaks or snakes) to appropriate authorities.
- Use fuel-powered generators outdoors. Do not bring them indoors. Use life-vests when engaged in activities that could result in deep water exposure.
- Use extreme caution when handling containers holding unknown substances or known toxic substances (for example floating containers of household or industrial chemicals). Contact the Environmental Protection Agency for information on disposal at the National Response Center (1-800-424-8802).
- Do NOT use improvised surfaces (e.g., refrigerator racks) for cooking food or for boiling water to avoid exposure to heavy metals.
Clothing and personal protective equipment
- Always wear water tight boots with steel toes and insoles, gloves, long pants and safety glasses during cleanup operations; sneakers should NOT be worn because they will not prevent punctures, bites or crush injuries. Wear a hardhat if there is any danger of falling debris.
- Wear a NIOSH-approved dust respirator if working with moldy building materials or vegetable matter (hay, stored grain or compost).
- When handling bleach or other chemicals, follow the directions on the package; wear eye, hand and face protection as appropriate, and have plenty of clean water available for eye wash and other first-aid treatments.
- Do NOT touch downed power lines or any object or water that is in contact with such lines.
- Treat all power lines as energized until you are certain that the lines have been de-energized.
- Beware of overhead and underground lines when clearing debris. Extreme caution is necessary when moving ladders and other equipment near overhead power lines to avoid inadvertent contact.
- If damage to an electrical system is suspected (for example, if the wiring has been under water, you can smell burning insulation, wires are visibly frayed or you see sparks), turn off the electrical system in the building and follow lockout/tagout procedures before beginning work. Do not turn the power back on until electrical equipment has been inspected by a qualified electrician.
- When using a generator, be sure that the main circuit breaker is OFF and locked out prior to starting the generator. This will prevent inadvertent energization of power lines from backfeed electrical energy from generators and help protect utility line workers from possible electrocution.
- Be aware that de-energized power lines may become energized by a secondary power source such as a portable backup generator.
- Any electrical equipment, including extension cords, used in wet environments must be marked, as appropriate, for use in wet locations and must be undamaged. Be sure that all connections are out of water.
- All cord-connected, electrically operated tools and equipment must be grounded or double insulated.
- Ground-fault circuit interrupters (GFCIs) must be used in all wet locations. Portable GFCIs can be purchased at hardware stores.
- Immediately evacuate any building that has a gas leak until the leak is controlled and the area ventilated.
- Be sure an adequate number of fire extinguishers are available and re-evaluate the fire evacuation plan.
- Be sure all fire exits are clear of debris and sand bags.
SBA Disaster Services
- Home Disaster Loans – Loans to homeowners or renters to repair or replace disaster-damaged real estate or personal property owned by the victim. Renters are eligible for their personal property losses, including automobiles.
- Business Physical Disaster Loans – Loans to businesses to repair or replace disaster-damaged property owned by the business, including real estate, inventories, supplies, machinery and equipment. Businesses of any size are eligible. Private, non-profit organizations such as charities, churches, private universities, etc., are also eligible.
- Economic Injury Disaster Loans (EIDLs) – Working capital loans to help small businesses, small agricultural cooperatives, small businesses engaged in aquaculture, and most private, non-profit organizations of all sizes meet their ordinary and necessary financial obligations that cannot be met as a direct result of the disaster. These loans are intended to assist through the disaster recovery period.
- EIDL assistance is available only to entities and their owners who cannot provide for their own recovery from non-government sources, as determined by the U.S. Small Business Administration (SBA).
- Credit History – Applicants must have a credit history acceptable to SBA.
- Repayment – Applicants must show the ability to repay all loans.
- Collateral – Collateral is required for physical loss loans over $14,000 and all EIDL loans over $5,000. SBA takes real estate as collateral when it is available. SBA will not decline a loan for lack of collateral, but requires you to pledge what is available.
By law, the interest rates depend on whether each applicant has Credit Available Elsewhere. An applicant does not have Credit Available Elsewhere when SBA determines the applicant does not have sufficient funds or other resources, or the ability to borrow from non-government sources, to provide for its own disaster recovery. An applicant, which SBA determines to have the ability to provide for his or her own recovery is deemed to have Credit Available Elsewhere. Interest rates are fixed for the term of the loan. The interest rates applicable for this disaster are:
|No Credit Available elsewhere||Credit Available elsewhere|
|Non-Profit Organization Loans||2.875%||2.875%|
|Economic Injury Loans|
|Business and Small Agric. Cooperatives||4.000%||N/A|
The law authorizes loan terms up to a maximum of 30 years. However, the law restricts businesses with credit available elsewhere to a maximum 7-year term. SBA sets the installment payment amount and corresponding maturity based upon each borrower’s ability to repay.
- Home Loans – SBA regulations limit home loans to $200,000 for the repair or replacement of real estate and $40,000 to repair or replace personal property. Subject to these maximums, loan amounts cannot exceed the verified uninsured disaster loss.
- Business Loans – The law limits business loans to $2,000,000 for the repair or replacement of real estate, inventories, machinery, equipment and all other physical losses. Subject to this maximum, loan amounts cannot exceed the verified uninsured disaster loss.
- Economic Injury Disaster Loans (EIDL) – The law limits EIDL(s) to $2,000,000 for alleviating economic injury caused by the disaster. The actual amount of each loan is limited to the economic injury determined by SBA, less business interruption insurance and other recoveries up to the administrative lending limit. SBA also considers potential contributions that are available from the business and/or its owner(s) or affiliates.
- Business Loan Ceiling – The $2,000,000 statutory limit for business loans applies to the combination of physical, economic injury, mitigation and refinancing, and applies to all disaster loans to a business and its affiliates for each disaster. If a business is a major source of employment, SBA has the authority to waive the $2,000,000 statutory limit.
- Uninsured Losses – Only uninsured or otherwise uncompensated disaster losses are eligible. Any insurance proceeds which are required to be applied against outstanding mortgages are not available to fund disaster repairs and do not reduce loan eligibility. However, any insurance proceeds voluntarily applied to any outstanding mortgages do reduce loan eligibility.
- Ineligible Property – Secondary homes, personal pleasure boats, airplanes, recreational vehicles and similar property are not eligible, unless used for business purposes. Property such as antiques and collections are eligible only to the extent of their functional value. Amounts for landscaping, swimming pools, etc., are limited.
- Noncompliance – Applicants who have not complied with the terms of previous SBA loans are not eligible. This includes borrowers who did not maintain flood and/or hazard insurance on previous SBA or Federally insured loans.
If your loan application is approved, you may be eligible for additional funds to cover the cost of improvements that will protect your property against future damage. Examples of improvements include retaining walls, seawalls, sump pumps, etc. Mitigation loan money would be in addition to the amount of the approved loan, but may not exceed 20 percent of total amount of disaster damage to real estate and/or leasehold improvements, as verified by SBA to a maximum of $200,000 for home loans. It is not necessary for the description of improvements and cost estimates to be submitted with the application. SBA approval of the mitigating measures will be required before any loan increase.
- SBA can refinance all or part of prior mortgages that are evidenced by a recorded lien, when the applicant (1) does not have credit available elsewhere, (2) has suffered substantial uncompensated disaster damage (40 percent or more of the value of the property), and (3) intends to repair the damage.
- Homes – Homeowners may be eligible for the refinancing of existing liens or mortgages on homes, in some cases up to the amount of the loan for real estate repair or replacement.
- Businesses – Business owners may be eligible for the refinancing of existing mortgages or liens on real estate, machinery and equipment, in some cases up to the amount of the loan for the repair or replacement of real estate, machinery, and equipment.
You may use your SBA disaster loan to relocate. The amount of the relocation loan depends on whether you relocate voluntarily or involuntarily. If you are interested in relocation, an SBA representative can provide you with more details on your specific situation.
To protect each borrower and the Agency, SBA may require you to obtain and maintain appropriate insurance. By law, borrowers whose damaged or collateral property is located in a special flood hazard area must purchase and maintain flood insurance for the full insurable value of the property for the life of the loan.
Submit a completed loan application and a signed and dated IRS form 8821 giving permission for the IRS to provide the SBA your tax return information. To process your application, the SBA needs current financial information such as a personal financial statement, a current profit-and-loss statement, balance sheet and a list of debts.
The disaster loan helps restore property to pre-disaster condition and, under certain circumstances, protects the structure from future disasters. It cannot upgrade or expand a business unless required by local building codes.
The SBA can refinance all or part of a previous mortgage in some cases when the applicant does not have credit available elsewhere, has suffered uninsured damage (40 percent or more of the property value) and intends to repair the damage. SBA disaster loan officers can provide additional details.
The sooner you return the completed loan application, the sooner the SBA can process it. The SBA tries to make a decision within 18 days. Make sure the application is complete. Missing information is a major cause of delays.
Physical loss loans of more than $14,000 and all EIDL loans of more than $5,000 must be secured to the extent possible. SBA will not decline a loan if there isn’t enough collateral but requires you to pledge what is available. That usually consists of a first or second mortgage on the damaged business real estate or best available if you don’t have real estate.
No. Don’t miss the filing deadline by waiting for an insurance settlement. Final insurance information can be added when a settlement is made. The SBA can approve a loan for the total replacement cost, but any insurance proceeds that duplicate SBA’s loan must be applied to your SBA loan.
The loan provides working capital for disaster-related needs until your business or private, non-profit organization recovers. You may request an EIDL for the amount of economic injury but not in excess of what your business or private, non-profit organization could have paid if the disaster had not occurred. EIDL loans cannot refinance long-term debts or provide working capital needed before the disaster. EIDL loans do not replace sales or lost profits.
Yes. The SBA must review a financial statement for each owner and one for each partner, officer, director and stockholder with 20 percent or more ownership. The SBA requires the principals of the business to personally guarantee repayment of the loan and in some instances to secure the loan by pledging additional collateral.
Yes. The penalty for misusing disaster funds is immediate repayment of one-and-a-half times the original amount of the loan.
The SBA does not have a minimum monthly payment. Payments vary depending upon income and expenses, size of family and other circumstances that may affect your repayment ability. Generally, the first payment is not due until five months after the date of the loan, but this term may be extended to a year in most cases upon request.
For more information, contact SBA’s Disaster Assistance Customer Service Center by calling (800) 659-2955, emailing email@example.com, or visiting SBA’s web site at http://www.sba.gov. Hearing impaired individuals may call (800) 877-8339. Applicants may also apply online using the Electronic Loan Application (ELA) via SBA’s secure Web site at http://disasterloan.sba.gov/ela.
Disaster Relief Contacts
General disaster resources
- Disaster Assistance.gov http://www.disasterassistance.gov(part of the Disaster Management Egov Initiative) is a secure, user-friendly web portal that consolidates information about federally funded government assistance to disaster victims.
- FEMA website: http://www.fema.gov/
- SBA website: http://www.sba.gov
- Disaster Food Stamps: http://www.fns.usda.gov/Disasters/disaster.htm
- Disaster Unemployment Assistance: http://workforcesecurity.doleta.gov/unemploy/disaster.asp
- Department of Housing and Urban Development (HUD) — Disaster Assistance General: http://www.hud.gov/info/disasterresources_dev.cfm
- Department of Housing and Urban Development: http://www.hud.gov/offices/pih/publications/notices/08/pih2008-21.pdf
- USDA Rural Development Disaster Assistance: http://www.rurdev.usda.gov/RDDisasterAssistance.html
- IRS Disaster Tax Relief:http://www.irs.gov/newsroom/article/0,,id=108362,00.html
- LawHelp: http://www.lawhelp.org helps low and moderate income people find free legal aid programs in their communities and answers to questions about their legal rights. Find information for free legal aid or pro bono legal assistance in all 50 states plus US territories.
- http://www.findlegalhelp.org/ Find legal resources in your state. Maintained by the American Bar Association.
Federal contact information
|FEMA (Disaster Assistance)||1-800-621-3362|
|United States Citizenship & Immigration Services||1-800-375-5283|
|United States Internal Revenue Service||1-800-829-1040|
|United States Social Security Administration||1-800-772-1213|
|Centers for Disease Control and Prevention||1-800-CDC-INFO; firstname.lastname@example.org|
FEMA disaster recovery centers in Missouri by county:
Little Axe Elementary School
2000 168th Ave
Norman, OK 73026
State Contact Information
|Oklahomas Attorney General’s Office:(OKC)||405-521-3921|
|Oklahomas Attorney General’s Office:(Tulsa)||918-581-2885|
|OK Insurance Department:(OKC)||405-521.2828|
|OK Insurance Department:(Tulsa)||918-295-3700|
|Oklahoma Department of Human Services:||405-521-3646|
|Oklahoma Natrual Resource Conservation:||580-237-4321|
|Oklahoma Employment Security Commision:||405-557-7100|
|Oklahoma Department of Labor:(OKC)||405-521-6100|
|Oklahoma Department of Labor:(Tulsa)||918-581-2400|
|Oklahoma Department of Health:||405-522-0726|
|Oklahoma Department of Mental Health and Substance Abuse Services:||405-522-3908(Local)|
|Oklahoma Department of Mental Health and Substance Abuse Services:||800-522-9054 (Toll Free)|
Oklahoma Small Business Development Centers– 580-745-2877 http://www.oksbdc.org
Insurance Company Contact Information
The following table is a list of common commercial insurance carriers. If your insurance carrier is not listed, please refer to your policy or your contact information or visit the Insurance Information Institute to locate contact information for your insurance carrier http://www2.iii.org/companies.cfm.
|Insurance Company||Website Url||Contact Number|
|The Hartford Financial Group||http://www.thehartford.com||800-327-3636|
|MetLife Auto & Home||http://www.metlife.com||800-854-6011|
|Utica National Insurance Group||http://www.uticanational.com||800-216-1420|
|Ironshore Insurance Ltd.||http://www.ironshore.com||877-476-6411|
|The Hanover Insurance Group, Inc.||http://www.hanover.com||800-628-0250|
|Aegis Insurance Services Inc.||http://www.aegislink.com||201-508.2740|
|Allstate Insurance Group||http://www.allstate.com||800-255-7828|
|Century Surety Company||http://www.centurysurety.com||800-825-9489|
|W. R. Berkley Corporation||http://www.wrberkley.com||Contact Agent|
|Liberty Mutual Group||http://www.libertymutual.com||800-225-2467|
|Magna Carter Companies||http://www.mcarta.com||Contact Agent|
|Farmers Group, Inc.||http://www.farmers.com||800-435-7764|
|OneBeacon Insurance Group||http://www.onebeacon.com||877-248-3455|
|Allianz of America, Inc.||http://www.allianz.com||1-866-884-3556|
|CUNA Mutual Group||http://www.cunamutual.com||800-356-2644|
|James River Group, Inc.||http://www.james-river-group.com||Contact Agent|
|Selective Insurance Group||http://www.selectiveinsurance.com||866-455-9969|
|Zurich North America||http://www.zurichna.com||800-987-3373|
|The Sullivan Group||http://www.gjs.com||Contact Agent|
|Chubb Group Of Insurance Companies||http://www.chubb.com||800-252-4670|
Oklahoma Offices of Emergency Management
|Name of Emergency Management||Address||Contact Number|
|Adair County Emergency Mgmt||600 Meade Drive Stilwell OK 74960||918-696-4255|
|Alfalfa County Emergency Mgmt||300 S. Grand Cherokee OK 73728||580-596-2392|
|Atoka Co. Emergency Mgmt||200 East Court St Suite Atoka OK 74525||580-364-0309|
|Beaver Co Emergency Mgmt||P.O. Box 786 Beaver OK 73932||580-625-3498|
|Beckham Co Emergency Mgmt||P.O. Box 67 Sayre OK 73662||580-928-9264|
|Blaine County Emergency Mgmt||P.O. Box 138 Watonga OK 73772||580-623-8566|
|Bryan Co/Durant Emergency Mgmt||2808 Enterprise Dr Durant OK 74701||580-924-3661|
|Caddo Co Emergency Mgmt||P.O. Box 1427 Anadarko OK 73005||405-933-1600|
|Canadian Co Emergency Mgmt||201 N. Choctaw El Reno OK 73036||405-295-6186|
|Carter Co Emergency Mgmt||107 SW 1st Street, Anne Ardmore OK 73401||580-223-7937|
|Cherokee Co./Tahlequah EM||111 S. Cherokee Tahlequah OK 74464||918-456-2894|
|Choctaw Co Emergency Mgmt||300 East Duke Hugo OK 74743||580-326-2000|
|Cleveland Co Emergency Mgmt||201 S. Jones Norman OK 73069||405-366-0249|
|Coal County Emergency Mgmt||3 S. Main Coalgate OK 74538||580-927-9008|
|Comanche Co Emergency Mgmt||315 SW 5th Rm 107 Lawton OK 73501||580-355-0535|
|Cotton County Emergency Mgmt||301 North Broadway Walters OK 73572||580-875-3031|
|Craig Co Emergency Mgmt||210 W Delaware Suite 1 Vinita OK 74301||918-244-1452|
|Creek County Emergency Mgmt||317 E. Lee Sapulpa OK 74066||918-227-6365|
|Custer Co Emergency Mgmt||P.O. Box 300 Arapaho OK 73620||580-323-4105|
|Dewey Co Emergency Mgmt||PO Box 368 Taloga OK 73667||580-328-5580|
|Ellis Co. Emergency Mgmt.||P.O. Box 283 Arnett OK 73832||580-334-0275|
|Garfield Co/Enid Emergency Mgmt||410 W Garriott Enid OK 73701||580-249-5969|
|Garvin County Emergency Mgmt||P.O. Box 237 Pauls Valley OK 73075||405-238-1148|
|Grady Co Emergency Mgmt||P.O. Box 339 Chickasha OK 73023||405-222-2339|
|Grant County Emergency Mgmt||112 E. Guthrie Medford OK 73759||580-395-2214|
|Greer Co/Mangum Emergency||P.O. Box 263 Mangum OK 73554||580-782-3254|
|Harmon County Emg. Mgmt.||221 East Lincoln Hollis OK 73550||800-477-0262|
|Harper Co/Laverne Emergency||P.O. Box 369 Buffalo OK 73834||80-735-2030|
|Haskell County Emergency Mgmt||202 East Main Stigler OK 74462||918-967-4488|
|Hughes County Emergency Mgmt||200 N. Broadway Holdenville OK 74848||405-379-7740|
|Jackson Co Emergency Mgmt||101 N. Main Rm 101 Altus OK 73521||580-482-0229|
|Jefferson Co Emergency Mgmt||220 N. Main St Waurika OK 73573||580-228-2341|
|Johnston Co Emergency Mgmt||604 E 24th Tishomingo OK 73460||580-371-0174|
|Kay County Emergency Mgmt||PO Box 450 Newkirk OK 74647||580-362-3825|
|Kingfisher Co/City Emergency||P.O. Box 525 Kingfisher OK 73750||405-375-5662|
|Kiowa County Emergency Mgmt||316 S Main Hobart OK 73651||580-726-3377|
|Latimer County/Wilburton EM||104 W Ada Wilburton OK 74578||918-465-3582|
|Leflore Co Emergency Mgmt||1215 S. Broadway Poteau OK 74953||918-649-0530|
|Lincoln Co Emergency Mgmt||811 Manvel Suite 4 Chandler OK 74834||405-258-1285|
|Logan Co/Guthrie Emergency||312 E. Harrison, Suite 1 Guthrie OK 73044||405-282-0494|
|Love Co/Marietta Emergency Mgm||101 W Main Marietta OK 73448||580-276-5861|
|Major County Emergency Mgmt.||500 East Broadway Fairview OK 73737||580-227-3126|
|Marshall County/Madill EM||201 E. Overton Madill OK 73446||580-795-2577|
|Mayes County Emergency Mgmt||1 Court Pl Suite 140 Pryor OK 74361||918-825-4650|
|McClain Co Emergency Mgmt||P.O. Box 548 New Castle OK 73065||405-288-2064|
|McCurtain Co. Emergency Mgmt||827 E Lincoln Rd Idabel OK 74745||580-208-2604|
|McIntosh Co/Eufaula||P.O. Box 722 Eufaula OK 74432||918-689-3441|
|Murray Co Emergency Mgmt.||P.O. Box 1-N Dougherty OK 73032|
|Muskogee County Emergency||P.O. Box 2274 Muskogee OK 74402||918-682-2551|
|Noble Co Emergency Mgmt||P.O. Box 1 Perry OK 73077||580-370-5676|
|Nowata Co. Emergency Mgmt||229 N. Maple Nowata OK 74048||918-273-2287|
|Okfuskee Co Emergency Mgmt||P.O. Box 108 Okemah OK 74859||918-623-9289|
|Oklahoma Co Emergency Mgmt||320 Robert S. Kerr, Suit Oklahoma City OK 73102||405-713-1369|
|Okmulgee Co EM||110 N. Alabama Ave. Okmulgee OK 74447||918-759-9984|
|Osage Co Emergency Mgmt||125 E 6th St Pawhuska OK 74056||918-287-2285|
|Ottawa County Emergency Mgmt||123 East Central Suite 1 Miami OK 74354||918-541-9391|
|Pawnee County Emergency||1305 W. Peninsula Dr. Cleveland OK 74020||918-243-7142|
|Payne Co. Emergency Mgmt||315 W. 6th Ave, Suite 2 Stillwater OK 74074||405-533-6875|
|Pittsburg Co/McAlester EM||1210 N. West Street McAlester OK 74501||918-423-5655|
|Pontotoc County Emergency Mgmt||P.O. Box 1425 Ada OK 74820||580-436-8055|
|Pottawatomie Co/ Shawnee EM||P.O. Box 1448 Shawnee OK 74802||405-878-1678|
|Pushmataha Antlers Emergency||100 SE 2nd Antlers OK 74523||580-271-2170|
|Roger Mills County||P.O. Box 708 Cheyenne OK 73628||580-497-3522|
|Rogers Co Emergency Mgmt||219 S. Missouri B-113 Claremore OK 74017|
|Seminole Co Emergency Mgmt||110 S Wewoka Ave, Sui Wewoka OK 74884||405-257-5445|
|Sequoyah Co Emergency Mgmt||117 S. Oak Sallisaw OK 74955-||918-775-1216|
|Stephens Co/Duncan Emergency||101 South 11th Street Duncan OK 73533||580-255-3411|
|Texas County Emergency Mgmt||P.O. Box 197 Guymon OK 73942||580-651-705|
|Tillman County Emergency Mgmt||P.O. Box 992 Frederick OK 73542||580-335-7549|
|Tulsa City/Co Area||600 Civic Center, EOC Tulsa OK 74103||918-596-9898|
|Wagoner Co Emergency Mgmt||16555 S 305th E Ave Coweta OK 74429||918-521-4007|
|Washington Co/Bartlesville||3931 SE Adams Rd Bartlesville OK 74005||918-331-2710|
|Washita Co Emergency Mgmt||125 W. Main Cordell OK 73632||580-832-3356|
|Woodward County/City||1219 8th Street Woodward OK 73801||405-466-5356|
The Center for Organizational Studies at the University of Wisconsin-Green Bay examined what sets apart small businesses that recover from those that fail after being affected by a disaster. The research report, written by Daniel J. Alesch, James N. Holly, Elliott Mittler and Robert Nagy, looks at the factors and variables that interact in complex ways to affect small business recovery. Five variables were found to be critical to long-term survival of an organization after a natural disaster:
- The disaster’s impact on the organization’s clientele. If the organization’s clientele is displaced from the area following the disaster, it is much more difficult for the organization to survive, because it will have to completely rebuild its client base.
- The availability of convenient substitute goods or services. If substitute goods or services are easily available while the organization is shut down after a natural disaster, it will be more difficult for the organization to maintain its client base.
- Pre-disaster major trends in the organization’s industry and the individual organization’s position in relation to those trends. If the organization is in a declining industry, it is less likely to recover, especially if the organization’s business is already declining.
- The extent of financial resources lost by the organization. The fewer financial resources the organization has to rebuild, relocate or take other appropriate action, the less likely it is to survive.
- The owner/operators ability to adapt to the new business environment. If the owner/operator is unable to appreciate the change in the business environment and make the necessary changes, the organization is less likely to survive.
Reacting to a natural disaster or emergency not only means ensuring the immediate safety of employees, but also planning how the business will continue to function in the aftermath. Limiting the amount of time your business is closed after an emergency situation is crucial; according to a 2006 survey by Harris Interactive, about 51 percent of companies said their customers would tolerate only a few hours of unplanned down time.
After you’ve made plans to ensure the safety of your employees, the following advice can help keep your business operating and meeting your customer’s needs in the wake of a disaster.
Contact all employees to provide them with a status report and assign tasks. As needed, appoint liaisons from your office to work with each of the following entities:
- Building management
- Health department
- Emergency management agencies
- Other governmental agencies
- Utility companies, including electric, gas, water, phone
- Insurance agent
- Key vendors
- Post office
- Other vital services
Contact vendors/suppliers to confirm their emergency response plan procedures. Establish a succession of management for the company. Determine who will manage the company if key leaders are unavailable. Communication is the key to maintaining clients and customers. Let your customers/vendors know your company’s status and when your business will assume normal operations. Be prepared to use alternate vendors for essential supplies and equipment depending on how much they were impacted by the disaster.
If your property is safe to enter, gather up all available paper records and begin the process of assessing damage, sorting and prioritizing restoration. Paper records damaged by water will begin to deteriorate within two to three hours; mold, fungal and bacterial growth will occur within 24 hours. Specific procedures must be followed in order to properly dry or freeze documents. (Freezing will preserve paper for up to six years for later drying.) If necessary, access extra checks stored off-site. Contact your bank for replacement checks.
Establish an emergency communication system to help your business communicate with employees, customers and vendors. This could involve setting up an emergency hotline and recorded message or arranging for a forwarding number. Keep in mind that after a disaster, it is often easier to make outgoing calls than to receive incoming ones. Therefore, it may be necessary to designate a contact outside the disaster zone who can act as a clearinghouse for information.
Post updates on social media sites, your business’s website and any other resources to communicate with your business network.
Determine alternate locations for your business to operate if you are displaced from your current building. This could mean enabling employees to work from home or finding an alternate location for your office. Depending on the size and location of your business, possibilities include hotels, motels, trailers, recreational vehicles, mobile food carts, space in other companies or firms with which you are associated, space in a satellite office, other suitable space in your existing building or space in your home.
If necessary, contact the post office about an alternate delivery location. Post a sign at your old location directing people to your temporary location. Consider advertising that temporary location in the local newspaper, and encourage customers to contact you to touch base. Be sure that anyone answering the phone informs all callers of your new location. Communicate all news and changes to your business on your website and social media.
If necessary, contact vendors to lease equipment or permanently replace damaged items (computers, network servers, printers, fax machines, copier, postage meter, desks, chairs, etc.). If your computers have been damaged from the disaster, get professional assistance to help in the recovery and repair of your computer system. Make it clear that your top priority is the data, not the equipment itself. A reputable repair shop can clean and test the system and, if necessary, use a package such as Norton Utilities to recover your data. More likely than not, the data stored on the hard drive can be recovered.
If my business was physically destroyed or damaged by the disaster, do my contracts for goods and services need to be performed?
It depends. A party will be relieved from its obligation to supply goods or perform services if, without the party’s fault, performance of the contract has become impossible. However, the impossibility must be “objective” in the sense that no one can perform the contract. For example, a contract to clean a house that was destroyed would be impossible to perform. If reasonable alternative means for performance of the contract are available, impossibility likely will not apply. However, other legal doctrines, as described below, may apply.
My business has not incurred damage; however, my business has deteriorated substantially after the disaster. Do my contracts for goods and services need to be performed?
Yes. Typically, impossibility excuses a party’s performance only when the destruction of the subject matter of the contract or the means of performance renders performance impossible. In addition, a party may be excused from performing its contractual obligations if performance is found to be impracticable. If a party has other ways to perform the obligations and only one option is precluded, that is not generally considered impracticable, even if the remaining option is more burdensome or more expensive.
Does a “force majeure” clause in a contract that my business has with another party automatically relieve the other party of its liability under the contract?
No. A “force majeure” clause is a provision in a contract that excuses a party to the contract from performing because of the occurrence of an event beyond the party’s control. The other party may or may not be liable depending on the provisions of the force majeure clause. A party may excuse itself from liability under a force majeure clause only by showing that the event preventing its performance was contemplated by the force majeure clause.
A force majeure clause may be drafted broadly (to include a few events such as an “act of war” and a catch-all phrase such as “or other events beyond its control” or “unavoidable causes”) or more narrowly (listing the specific events that prevent performance and including only a narrow catch-all). Even if the contract does not contain a force majeure clause, or if the clause is not broad enough to include the events surrounding the disaster, it is possible that a contract will not be enforced due to “impossibility” and related doctrines discussed above.
If the business owner or key employee is incapacitated, does the business still need to perform contracts of personal service?
No. If the primary purpose of a personal services contract is to permit a specified person to perform in a certain manner, there is an implied intent by the parties to hold each other liable only if the health and life of that person permits continued performance. To be covered under this general rule, the act or acts to be performed must be ones that can be performed only by the particular individual named in the contract.
What happens to advances received from third parties (or given to third parties) where the performance of the contract is excused?
If goods or services are not supplied, advances must be returned.
What if I can no longer deliver or accept goods under my contracts? Can someone else perform on my behalf?
Absent a provision in the contract prohibiting assignment, a party may be able to delegate or assign its duties or rights under a contract to someone else unless the other party has a substantial interest in having the original promisor perform the acts required by the contract. The rights of the buyer or seller also may be assigned unless the assignment would significantly change the duty of the other party, increase the burden or risk imposed on him by the contract or significantly impair the chance of obtaining return performance. Parties delegating or assigning duties will still be liable under the original contract. Many commercial contracts provide that duties of the buyer and seller cannot be delegated or assigned without the prior written consent of the other party.
Liability for damaged property
What if goods that were paid for by the buyer were destroyed before they could be delivered?
In the absence of an agreement to the contrary, risk of loss of goods subject to sale passes in the following manner: (1) if a contract requires physical delivery of identified goods to a specific destination, title passes on tender of the goods at that destination; (2) if the contract does not specify a place of delivery, title passes at the time and place of shipment; (3) if delivery is to be made without moving the goods, title passes at the time and place documents of title are to be delivered; and (4) if no documents of title are delivered, title passes at the time and place of contract. An insurance policy may cover damage to or destruction of the goods.
If I have equipment that was either leased or purchased on credit and is now destroyed or damaged, am I obligated to continue making payments on the equipment?
This question is usually governed by the terms of the specific contract, lease or credit agreement. In addition, the loss of equipment could be covered by an insurance policy. If the equipment was not covered by an insurance policy, most likely payments must continue to be made.
Is my business liable for damage to a customer’s property caused by the disaster, flooding or looting? Is my dry cleaner or laundry business liable for damage to customers’ clothing that was in the store? Is my jewelry/TV/watch repair store liable for damages to customers’ property that was in the store for purposes of repair or maintenance?
Probably not. When the owner of personal property (a bailor) delivers the property to another (a bailee) for a particular purpose, with the understanding that the property must be returned to the owner, a bailment contract is formed. In each of the three situations above, a bailment relationship exists for benefit of both parties because the bailee receives compensation and the bailor receives a service. Therefore, the bailee would only be liable to the bailor for property damaged through the bailee’s negligence. Because the relevant legal standard is the bailee’s negligence, it is necessary to consider how the property was damaged or lost and what actions the bailee took to protect it.
Destruction caused by the disaster or looting would not likely be a breach of the bailment contract. However, the other jewelry stores carried customer merchandise out of the store and one jeweler did not, then that jeweler may be deemed negligent. In addition, if all dry cleaners except one locked the door when evacuating, that dry cleaner may be deemed negligent if a customer’s clothes were stolen.
Lost checks or correspondence
If, for example, my insurance payment premium was due on April 30 and the payment was sent on April 27, would the policy cover damages that occurred on August 29, even if the payment was not received on the actual due date or was destroyed in the mail?
The posting rule (or “mailbox rule” in the U.S., or “postal rule” or “deposited acceptance rule”) is an exception to the general rule of contract law in common law countries that acceptance takes place when communicated. The posting rule states, by contrast, that acceptance takes effect when a letter is posted. One rationale given for the rule is that the offeror nominates the post office as implied agent and thus receipt of the acceptance by the post office is regarded as that of the offeree. The “mailbox rule” or “postal acceptance rule” described above also applies to insurance premiums. Assuming that the insurance company requested that the premium be mailed and the premium payment was mailed in a timely manner, the insurance company is obligated to defend and indemnify the insured party.
What if a check was mailed but it was not received?
There are different alternatives depending on the type of check that was lost:
Checks payable from debtor’s account: A bank customer has a right to stop payment of any item, including a check, drawn on that customer’s account. After the stop payment is made, the debtor may issue a new check without bearing the risk of loss should the bank fail to stop the original check.
Certified checks: Since certified checks are drawn by the bank, the bank is not required to stop payment on lost or destroyed checks and issue replacements unless an indemnity bond of twice the unpaid amount is posted. This serves to protect banks from potential double liability, should a holder of the lost check later present it for payment.
My business has a city contract on which we have performed, but payment on vouchers has been delayed due to the disaster. What action can I take to expedite processing and payment?
Many cities may experience delays in making various contract payments due to the effects of the disaster, a situation that has been impaired by the reallocation of resources. The first step is to try and contact your contract manager who should have the most current information about the agency’s operations. If you cannot locate the contract manager or if he or she lacks information, you can contact the city government. If payment is still not forthcoming, you may be able to file a notice of dispute, depending on the procedures of the city government. You likely will need to continue to supply services during adjudication of any disputes or you will be considered in breach of contract.
Employees & Layoffs
The answers to each of the following questions are based on the assumption that the affected employees are not covered by a collective bargaining agreement and do not have an employment contract with their employer. In the event that the affected employees are covered by a collective bargaining agreement or an employment contract, the employer should consult the terms and conditions of those agreements and contracts. Similarly, if the employer has certain established employment policies, the employer should consult and comply with its policies.
Worker laws can be either state or federal. Federal labor laws apply to all workers in the country while state laws apply in their own areas. Some states make few laws of their own and rely mainly on federal law to regulate employer-employee relations, while others set their own laws.
Does an employer have to pay its employees for the days that the business was closed as a result of the disaster and its aftermath?
The answer to this question depends on whether the employee is considered an “exempt” employee or a “non-exempt” employee for purposes of federal and state wage-and-hour laws. Every employee must be treated as either exempt (not entitled to premium pay for overtime hours worked) or non-exempt (entitled to premium pay for overtime hours worked) under federal and state wage-and-hour laws.
The determination of whether an employee is “exempt” or “non-exempt” is a complicated, fact-specific determination. Generally speaking, an employee is considered a non-exempt employee if the employee is paid on an hourly basis and not on a salary basis. In contrast, to be considered an exempt employee, an employee must be paid on a salary basis and must have certain job duties and responsibilities that are executive, administrative or professional (among others) as required under the applicable wage and-hour laws.
An employer is not required to pay its non-exempt employees for any days or hours that the employees did not work because the business was closed following the disaster. The employer is, however, required to pay the non-exempt employee for any hours worked prior to the disaster. An exempt employee should receive his or her full salary for any week in which he or she performs any work without regard to the number of days or hours worked. Thus, if an exempt employee worked on Monday, May 20th, but worked no other days during the week, then the employer should pay the employee his or her full salary for that week.
If an employer’s records were destroyed as a result of the disaster and its aftermath, what basic payroll records does the employer need to try to recreate?
Under federal law, every employer must establish, maintain and preserve weekly payroll records, including the following information for each employee:
- Employee’s full name, as used for social security purposes
- Address, including zip code
- Birth date, if younger than 19
- Sex and occupation
- Time and day of week when employee’s work week begins
- Hours worked each day and total hours worked each workweek
- Basis on which employee’s wages are paid
- Regular hourly pay rate
- Total daily or weekly straight-time earnings
- Total overtime earnings for the work week
- All additions to, or deductions from, the employee’s wages
- Total wages paid each pay period, including money paid in cash
- Date of payment and the pay period covered by the payment
There is no special rule relieving employers of this obligation in connection with a disaster.
When must an employer pay its workers if the employer’s payroll records were destroyed?
Any organization employing as many as 50 or more employees must make full payment to employees for services performed as often as once every two weeks, or twice during each calendar month. This payment must include all amounts due for labor or services performed up to not less than 15 days previous to the time of payment.
Does an employer have to reimburse its employees for the destruction or loss of any of their personal items, such as personal computers or cars that they may have used for business purposes?
You should consult with your insurance provider to determine whether loss of employees’ personal property is covered by any insurance policy. Ordinarily, employers are not responsible for reimbursing employees for the loss or damage to personal property an employee chose to bring to the work site.
Once an employer reopens its business, does the employer have to pay its employees for the days on which a transportation problem or some other obstacle prevented them from reporting to work?
This also depends on whether the employee is considered an exempt or non-exempt employee. For purposes of wage-and-hour laws, the employer is not required to pay a non-exempt employee for any days or hours that the employee was absent from work due to a transportation problem or some other obstacle that prevented him or her from reporting to work. An exempt employee should receive his or her full salary for any week in which he or she performed any work.
May an employer require its employees to use their accrued vacation or sick leave to cover their absences from work due to the disaster?
Once the employer reopens, if an employee is unable to report to work due to the disaster, the employer may require an employee to use his or her accrued vacation or sick leave to cover his or her absences, provided that this is consistent with the employer’s leave policies and provided that the employee’s absence from work does not qualify as leave pursuant to the Family Medical Leave Act (FMLA).
Leave under the FMLA. The FMLA provides that a covered employee may take up to a total of 12 weeks’ unpaid leave during any 12-month period for certain qualifying reasons. During the leave period, the employer must maintain the employee’s health benefits and must guarantee that the employee will be reinstated to the same or an equivalent position.
The FMLA applies to only those employers that employ 50 or more employees for each working day in each of 20 or more calendar workweeks in the current or preceding calendar year. An employee is entitled to FMLA leave if the employee (1) has been with the employer for at least 12 months, (2) logged at least 1,250 hours of services during the 12-month period immediately preceding the start of the leave and (3) is employed at a work site where 50 or more employees are employed by the employer or within 75 miles of that work site. FMLA leave may be taken to care for the employee’s spouse, child or parent with a serious health condition or because of a serious health condition that makes the employee unable to perform the functions of the employee’s position.
Eligible employees are entitled to 12 work weeks of leave in a 12-month period for:
- the birth of a child and to care for the newborn child within one year of birth;
- the placement with the employee of a child for adoption or foster care and to care for the newly placed child within one year of placement;
- to care for the employee’s spouse, child or parent who has a serious health condition;
- a serious health condition that makes the employee unable to perform the essential functions of his or her job;
- any qualifying exigency arising out of the fact that the employee’s spouse, son, daughter or parent is a covered military member on “covered active duty;” or
- twenty-six work weeks of leave during a single 12-month period to care for a covered service member with a serious injury or illness who is the spouse, son, daughter, parent or next of kin to the employee (military caregiver leave).
For compliance information, see http://www.dol.gov/whd/fmla/
Is an employee entitled to either paid or unpaid leave so that he or she can care for children or family members injured by the disaster?
If the employee is entitled to FMLA leave as described above, the employer must allow the employee to take FMLA leave. This leave does not have to be paid leave, but the employee may be able to use accrued vacation or sick leave for the absence. Also, if the employer has a specific policy providing for leave under such circumstances, the employer will be required to comply with its policy.
Is an employee entitled to either paid or unpaid leave if the employee is too afraid or emotionally traumatized to return to work?
If the employee is suffering from post-traumatic stress or some other mental condition, the employer may be required to provide the employee with unpaid leave under the FMLA. However, the employee will have to meet the applicable requirements of the FMLA, as set forth above. If the employer provides paid leave, the employee may be able to use his or her accrued vacation or sick leave for the absence.
Health and welfare benefits FAQ
Are there sources beyond or in lieu of employers’ own insurance policies to alleviate some of the financial burden caused by the disaster?
Many of the individuals injured by the disaster may be able to receive benefits from a number of sources, including federal government assistance, charitable donations and unemployment compensation. Thus, employers should, without delaying treatment for any employees or their dependents, pay special attention to the rules of their policies regarding subrogation and the order of benefit determinations.
What can employers do to help their employees recover psychologically from the trauma of the disaster and its aftermath?
Plans may experience an increase in mental health claims, as well as more requests for assistance under employee assistance programs (EAPs). Employers should advise their employees of the availability and importance of such counseling, both for themselves and their families. If an employer does not have an EAP, counseling and other related services are available on a fee-paying basis.
What should be done about Consolidated Omnibus Budget Reconciliation Act (COBRA) coverage?
COBRA generally requires that group health plans sponsored by employers with 20 or more employees in the prior year offer employees and their families the opportunity for a temporary extension of health coverage (called continuation coverage) in certain instances where coverage under the plan would otherwise end due to a “qualifying event” (such as the death of the covered employee, termination of employment or reduction of hours sufficient to cause the loss of medical coverage). Employees self-pay the premium.
Once an affected employee loses coverage as a result of one of these events, the employer must take action to notify the plan administrator within the prescribed time period. Qualified beneficiaries must be informed of their right to continued health insurance coverage under COBRA within 44 days (the employer must notify plan administrator within 30 days, which must then notify eligible dependents within 14 days) of a qualifying event. All required notices regarding COBRA should be carefully documented and timely. Generally, the qualified beneficiary has 60 days from the later of (a) the date of termination of coverage, or (b) his or her receipt of a COBRA notice to elect to continue coverage. COBRA coverage can usually continue for up to 18 months for the employee and the employee’s dependents and for 36 months for family members of a deceased worker.
Does an employer have to provide its employees with any prior notice of termination if the employer determines that it is necessary to lay off employees?
No, if the employer does not have an established policy requiring that prior notice be given, the emergency circumstances of the disaster would relieve the employer of a notice obligation. Usually, employers with more than 100 employees may have an obligation to provide certain notice to its employees pursuant to the Worker Adjustment and Retraining Notification (WARN) Act. However, the WARN Act contains an “Act of God” provision if the layoff or shutdown is the result of a natural disaster. Note that employers with established policies requiring that prior notice be given may be required to comply with their policies.
Does an employer have to provide its employees with severance pay if the employer determines to lay off employees?
No, so long as the employer does not have a plan, policy or practice providing for the payment of severance benefits. The state laws of Missouri, as well as federal law, do not require employers to provide severance pay to departing employees.
Is a self-employed, small business owner eligible to receive unemployment insurance benefits?
No. Self-employed, small business owners (sole proprietorships and members of a partnership or limited liability company) as well as independent contractors are not eligible for unemployment insurance benefits. However, persons denied unemployment insurance benefits may be eligible for disaster unemployment assistance (DUA).
Workers who lost their jobs directly as a result of the disaster in the declared counties may quality for disaster unemployment assistance. Generally, those who are eligible for state unemployment benefits are not eligible for DUA, but a claimant may qualify if state unemployment compensation benefits are exhausted.
Those who may be eligible for disaster unemployment assistance include anyone who (1) no longer has a job; (2) was unable to reach his or her job; (3) was scheduled to start work in the major disaster area and the job no longer exists; (4) now serves as the breadwinner or major supporter of a family because the head of household died; or (5) cannot work because of an injury suffered during the major disaster.
Self-employed individuals must show a copy of their 2010 income tax records.
Note: If you are applying for DUA, call 525-1500 (inside OKC area) and 1-800-555-1554 (outside the OKC area)first to get a registration number.
Finding a Contractor
The Oklahoma Construction Industries Board has been set up to assist Oklahomans in finding licensed contractors. The mission of the Construction Industries Board is to protect life and properly by licensing and inspection of the related trades for the health, safety, and welfare of the public.
Construction Industries Board
2401 NW 23rd St, Suite 2F
Oklahoma City, OK 73107
Local: (405) 521-6550
Toll Free: (877) 484-4424
Fax: (405) 521-6525
Office Hours & Additional Information
* Hours of Operation: 8:00 a.m. to 4:30 p.m., Monday through Friday except on Holidays.
- Ask friends, neighbors and co-workers for contractor referrals.
- Contact local trade organizations, such as the Builder’s Association or Remodeler’s Council for the names of members in your area.
- Contact the vendors who sell supplies to contractors.
- Check Google reviews and other online review sites to gather feedback from previous customers of the contractor.
Hiring a Contractor
When hiring a contractor, watch out for scam artists. You should be especially weary of phone or door-to-door solicitations that promise to speed up the insurance or building process and those who ask for large cash deposits or advance payments in full.
Consumers should also be aware that some rip-off artists may pretend to be employed by FEMA or other agencies. Some traits of scams or con artists can include:
- Lack of proper identification: A FEMA or SBA shirt or jacket is not absolute proof of someone’s affiliation with an agency. Ask to see the laminated photo identification card; if they don’t have it, they are probably not official.
- Going door-to-door: Persons going door-to-door to damaged homes or phoning victims claiming to be building contractors could be frauds. If callers solicit personal information such as Social Security or bank account numbers, they are not official. FEMA inspectors may come to your neighborhood, but all FEMA inspectors will have proper laminated photo identification. Remember, FEMA and SBA inspectors never charge applicants for disaster assistance or for inspections. If in doubt, do not give out information.
- Charging fees to be put on a list or fees to have forms filled out: Some scammers have asked for upfront money to be put on a list or demanded fees to fill out the disaster loan application.
- Offers to increase the amount of your disaster damage assessment: This is not wise and is a sure sign of a scam.
- Asking for cash upfront: Under no circumstances are FEMA and other agency representatives allowed to accept money. FEMA inspectors assess damage but do not hire or endorse specific contractors.
If you suspect a repair rip-off, fill out a consumer complaint application with the Oklahoma Attorney General’s office. You can find the complaint forms at http://www.oag.state.ok.us/oagweb.nsf/ccomp.html. If you suspect fraud, waste or abuse involving FEMA disaster assistance programs, report it to FEMA’s Inspector General’s Office at (800) 323-8603.
In addition to taking precautions to prevent getting ripped-off, the following will assist you in hiring a contractor to get your business up and running:
- Get a written estimate. Compare services and prices before making a final decision. Also, read the fine print. Some contractors charge a fee for a written estimate, which is often applied to the cost of subsequent repairs they make.
- Check references. Contractors should be willing to provide names of previous customers. Call several former customers who had similar work done to make sure they were satisfied with the job.
- Ask for proof of insurance. Make sure the contractor carries general liability and workers’ compensation insurance. If the contractor is not insured, you may be liable for accidents that occur on the property.
- Use reliable, licensed contractors. Call the local building inspector, Better Business Bureau, Home Builders Association, Building Trade Council or the local Chamber of Commerce to see if any complaints have been filed against the contractor.
- Insist on a written contract. A complete contract should clearly state all tasks to be performed, all associated costs and the payment schedule. Never sign a blank contract or one with blank spaces. Make sure the contract clearly states who will apply for the necessary permits or licenses. Have a lawyer review the contract if substantial costs are involved, and keep a copy for your records.
- Get guarantees in writing. Any guarantees made by the contractor should be written into the contract. The guarantee should clearly state what is guaranteed, who is responsible for the guarantee and how long the guarantee is valid.
- Obtain a local building permit, if required. Permits may be required for site work other than demolition and for reconstruction. Contact your local government for permit information.
- Make final payments when the work is completed. Do not sign completion papers or make the final payment until the work is completed to your satisfaction. A reputable contractor will not threaten you or pressure you to sign if the job is not finished properly.
- Pay by check. Avoid on-the-spot cash payments. The safest route is to write a check to the contracting company. A reasonable down payment is 30 percent of the total cost of the project, to be paid upon initial delivery of materials. Federal law gives consumers a three-day “cooling off” period for unsolicited door-to-door sales of more than $25.
- If necessary, cancel a contract in the proper manner. This should be done within three business days of signing. Be sure to follow the procedures for cancellation that are set out in the contract. Send the notification by registered mail with a return receipt to be signed by the contractor.
- Get a written contract.
- Specify the start and finish dates to protect your interests, but realize that bad weather, unavailable materials or other problems may affect these dates.
- Include pay schedules and itemized prices. If you want special materials such as hardwood trim or top grade lumber, be sure this is specified.
- If possible, have a lawyer review all contracts and related documents before you sign.
- Don’t make a large first payment, and don’t pay for the project in full until work has been completed and inspected.
- Clearly state any warranties or guarantees on the work.
- Be sure you and the contractor sign the agreement, with each of you keeping original copies.
The following questions are designed to provide general information for small businesses that rent their space from a landlord and for landlords who rent space to small businesses. Generally, the rights of both the tenant and the landlord will be determined by the provisions of your lease. There is no one single “standard” form of lease, even though many leases are based on preprinted lease forms. The provisions of a lease that covers these matters can vary significantly, even for different leases in the same building.
A legal professional will need to check the provisions of your lease carefully to answer these questions for your particular case. The following is only general advice for tenants and landlords regarding property that is damaged or unusable as a result of destruction relating to the disaster. The advice is based on general principles of state law in Oklahoma and some of the form leases commonly used in Oklahoma and should not be relied upon without first consulting an attorney.
What happens if the building or property that is leased is destroyed? Does the lease automatically terminate? Does the tenant have to pay rent?
To answer these questions, you will need to first check your lease to see if there is a specific written provision setting forth what happens if the leased premises are totally destroyed or partially destroyed. Most business leases include this type of provision, and these provisions may include definitions that will help you to determine whether your building has been totally destroyed or partially destroyed. If your lease contains such written provisions, those written provisions will govern and should provide the answer to your question.
If your lease does not contain specific provisions setting forth what happens when the leased premises are totally or partially destroyed, or if you do not have a written lease, then this question will be answered based on general provisions of state law.
Generally, unless a lease contains specific provisions to the contrary, a lease automatically terminates only when the leased premises are “totally destroyed.” The critical factor is whether the leased premises are “totally destroyed” or only “partially destroyed.” Determining whether the premises are totally or partially destroyed is a fact determination made on a case-by-case basis. In most situations, the lease will terminate only if the premises are “totally unfit for use.”
Whether the property is totally unfit for use will depend on several factors. The primary factor is the extent of damage. For example, a building that burns to the ground or is completely submerged by floodwaters would likely be considered totally destroyed. But if the damage is limited (for example, if only the roof is damaged or floodwater only damaged the floor or carpet of a leased building), then the tenant probably cannot terminate the lease on the basis of that damage.
Another factor is the landlord’s ability to repair the premises. If the landlord can repair the damage in a reasonable period of time, then the tenant may not be able to terminate the lease. The length of time that a landlord has to make repairs will depend on the circumstances and may hinge on the term of the lease. If a lease is for a term of 10 years and there are still eight years remaining on the lease, it might be reasonable for the landlord to take 30 or 60 days to make repairs. But if the lease is for a shorter term or if there are only several months left on the lease, then 30 or 60 days would not be reasonable and the tenant should be entitled to terminate the lease.
In some cases, it is necessary for the tenant to provide notice before terminating the lease. Once the lease is terminated, the tenant is relieved of any obligation to pay rent. But until the lease is terminated, the tenant must continue to pay rent according to the terms of the lease. In some cases, the tenant may be able to pay an adjusted rent until necessary repairs are made, but the need for repairs does not automatically release the tenant from its obligation to pay rent.
Is the landlord obligated to rebuild the building?
Again, it is important to refer to your lease, as commercial leases generally have provisions dealing with the landlord’s obligations to rebuild. Absent an express provision in the lease, the answer generally depends on the severity of the damage. If the leased premises are partially damaged or rendered partially unusable for the purpose for which it was leased, then the landlord is obligated to make all necessary repairs at its expense.
If the building is so seriously damaged that the landlord decides to demolish or rebuild it, or in the event the premises are totally damaged or rendered wholly unusable, the landlord may terminate the lease rather than rebuilding.
Does the tenant have the right to terminate the lease if the landlord plans to rebuild the building?
Although law provides the tenant with a right to terminate the lease if the premises are partially destroyed, commercial leases almost always have specific provisions which supersede the statute. Tenants should consult their own lease.
Can the landlord terminate the lease if the premises are partially destroyed?
A landlord can terminate a lease when (1) the lease itself gives the landlord a right to terminate when a disaster renders the premises partially unusable, or (2) the landlord and tenant mutually agree to terminate the lease.
If the landlord terminates the lease, is the tenant entitled to receive its security deposit?
Details regarding the refund of the security deposit will be controlled by the terms of the lease.
Is the landlord required to repair and restore the tenant’s furniture and equipment?
Generally, the landlord is not required to repair any damage to the tenant’s furniture and/or furnishings or any fixtures, equipment, improvements or appurtenances that are removable. This damage should be covered by the tenant’s insurance company.
Is the tenant obligated to pay rent during the time that the landlord makes repairs on the building?
Again, this depends on the severity of the damage. Determining whether premises are totally or partially destroyed is a fact determination made on a case-by-case basis. To be considered “totally destroyed,” the premises must cease to be fit for use. Extreme flood or storm damage is likely to be considered “total destruction,” while minor flood or storm damage is most likely only a partial destruction.
Rent reductions will be governed by the terms of the lease. In any case, before paying less than full rent, the tenant should always talk to the landlord to reach a mutual agreement on any rent reduction. If the landlord and the tenant cannot agree on the appropriate amount of the reduction, then the tenant must sue and have a court decide the amount.
In the event the premises are totally damaged or rendered wholly unusable, the lease terminates with no further liability on the part of the tenant or the landlord. The tenant does not have to continue rent payments from the time of the destruction.
Once the landlord completes the restoration of the premises, the tenant may still have work to do to repair installations, phones, office equipment, etc. The tenant will be obligated to pay rent during this time period, but may be able to cover the cost of that rent from proceeds of the tenant’s business interruption insurance policy.
Note: commercial leases have specific provisions governing rent abatement in the event of destruction of the premises, and these provisions dictate the rights of the landlord or tenant. Refer to your lease for the terms that apply to your situation.
How long can the landlord take to repair the premises?
If the landlord elects or is required to repair the premises, the landlord must do so reasonably expeditiously, subject to delays due to adjustment of insurance claims, labor troubles and causes beyond the landlord’s control.
Can the tenant withhold rent if the landlord has failed to repair the premises in a timely manner after the disaster?
Generally, a tenant remains obligated to pay rent if the premises are usable and are not totally destroyed or made unusable, as discussed above. Thus the requirement to pay rent is not generally dependent on whether the landlord makes timely repairs, unless the tenant decides to terminate the lease on this basis. The tenant may terminate the lease, if the landlord fails to timely repair the premises in a timely manner. In that case, once the lease is terminated, the tenant is no longer required to pay rent.
If the landlord elects to terminate the lease, is the landlord obligated to help the tenant find alternative space or reimburse the tenant for related costs?
No, unless the lease contains a specific provision that provides for this.
Can the landlord rent the premises to someone else while the tenant is gone?
No, a landlord cannot rent the premises to another party unless the lease has been terminated. The landlord has an obligation to make the leased space available to the tenant as long as the lease is in effect. The landlord cannot impair the tenant’s “peaceful possession” of the property unless there has been a default by the tenant and the lease has been terminated.
Can the building be condemned?
Yes. Governmental agencies that have jurisdiction over a building may order it to be condemned if the building is not suitable for safe occupancy. Generally, either FEMA or the local building inspection department is the agency that has jurisdiction to determine that a building cannot safely be occupied.
If the building is condemned, will the property owner be paid for the loss?
When the government condemns property based on a finding that it is no longer habitable or safe for occupancy, the government is not responsible for paying for the loss of the property. Generally, the government is only required to pay for the loss of the property when the property is taken by the government for a public use.
Condemnation of property as unsafe generally is not a “taking” for public use. To the extent the owner can recover the lost value of the condemned property, the property owner might be able to recover all or part of the value of the property from the owner’s insurance (depending on the terms of that insurance) or from FEMA or other relief agencies.
Internal Revenue Service
For this disaster, until June 30, the IRS is postponing certain deadlines for taxpayers who live or have a business in the disaster area. The deadlines in your situation may vary.
- Under section 7508A, the IRS gives affected taxpayers until June 30 to file most tax returns (including individual, corporate, and estate and trust income tax returns; partnership returns, S corporation returns and trust returns; estate, gift and generation-skipping transfer tax returns; and employment and certain excise tax returns), or to make tax payments, including estimated tax payments, that have either an original or extended due date occurring on or after April 15 and on or before June 30.
- The IRS also gives affected taxpayers until June 30 to perform other time-sensitive actions described in Treas. Reg. § 301.7508A-1(c)(1) and Rev. Proc. 2007-56, 2007-34 I.R.B. 388 (August 20, 2007), that are due to be performed on or after April 15 and on or before June 30.
- This relief also includes the filing of Form 5500 series returns in the manner described in Section 8 of Rev. Proc. 2007-56. The relief described in Section 17 of Rev. Proc. 2007-56, pertaining to like-kind exchanges of property, also applies to certain taxpayers who are not otherwise affected taxpayers and may include acts required to be performed before or after the period above.
- The postponement of time to file and pay does not apply to information returns in the W-2, 1098, 1099 series, or to Forms 1042-S or 8027. Penalties for failure to timely file information returns can be waived under existing procedures for reasonable cause. Likewise, the postponement does not apply to employment and excise tax deposits. The IRS, however, will abate penalties for failure to make timely employment and excise tax deposits due on or after April 15 and on or before May 2 provided the taxpayer made these deposits by May 2.
- Affected taxpayers in a federally declared disaster area have the option of claiming disaster-related casualty losses on their federal income tax return for either this year or last year. Claiming the loss on an original or amended return for last year will get the taxpayer an earlier refund, but waiting to claim the loss on this year’s return could result in a greater tax saving, depending on other income factors. See your CPA or Tax Preparer.
- Individuals may deduct personal property losses that are not covered by insurance or other reimbursements. For details, see Form 4684 and its instructions.
- Affected taxpayers claiming the disaster loss on last year’s return should put the Disaster Designation “Oklahoma/ Severe Storms and Tornados” at the top of the form so that the IRS can expedite the processing of the refund.
- Taxpayers may download forms and publications from the official IRS Web site, www.irs.gov, or order them by calling 1-800-TAX-FORM (1-800-829-3676). The IRS toll-free number for general tax questions is 1-800-829-1040.
- If an affected taxpayer receives a penalty notice from the IRS, the taxpayer should call the telephone number on the notice to have the IRS abate any interest and any late filing or late payment penalties that would otherwise apply. Penalties or interest will be abated only for taxpayers who have an original or extended filing, payment or deposit due date, including an extended filing or payment due date, that falls within the postponement period.