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A Hurricane of Preparations

Bob Purdy got lucky during last year's record hurricane season. Twice, in fact. The disaster spared his company, Edwards Roofing in Pensacola, Fla., from severe damage to its main office, and when the time came for cleanup and rebuilding, hundreds of other small businesses turned to him for new roofs.

Purdy says within a week of Hurricane Ivan, which struck on Sept. 16, his phone rang more than 1,000 times. The answering machine shut down after 400 messages. Even now, months after what scientists and meteorologists call the worst hurricane season in a century, Edwards Roofing has 125 jobs on the books. A few years back, 25 jobs was peak season.

LOAN NEED LINGERS. Business is up, but he's not exactly happy. "It's more than we would ever want," says Purdy, whose family has owned Edwards Roofing for more than 70 years. He has resisted saying no to longtime, loyal customers, even though his supply sources are all but tapped out. "You can't turn them away, but then how many people are you going to let in your lifeboat?"

The 2005 hurricane season officially starts June 1, but many Florida small businesses are still reeling from the 2004 storms. Because they operate on a modest scale, often with lower profit margins, lost sales over even a few days or weeks can devastate a small shop's bottom line for years.

As of May 5, the Small Business Administration had approved more than $2 billion in low-interest disaster loans to some 63,000 homeowners, renters, and business proprietors whose property suffered damaged in one of the four major hurricanes last year. That dollar figure exceeds the combined total for the previous 15 years.

VARIED VULNERABILITY. Homeowners can borrow up to $200,000 to repair or replace damaged or destroyed real estate and up to $40,000 to repair or replace damaged or destroyed personal property. The SBA has extended the deadline to apply for the loans three times, and many applications are still pending. According to Purdy, his customers could use the extra time.

"You get folks in different categories," says Herbet Mitchel, director of the SBA's Office of Disaster Assistance. "Some have insurance and additional resources that allow them to sustain their operations. But in every disaster, small businesses are particularly vulnerable. They don't have the resources that a medium or large business would have in terms of being able to go out and start all over again."

Experts recommend that small-business owners identify potential hazards on their properties ahead of time, develop a plan that includes escape routes and a list of emergency numbers for employees, and keep duplicate copies of business and personal records off-site. The SBA and the Institute for Business & Home Safety offer additional tips online.

NAVAL DISASTER. Total property damage from the 2004 hurricanes exceeded $40 billion, the costliest season on record. According to estimates by the New York City-based Insurance Information Institute, the hurricanes harmed, to some degree, one in five Florida homes. More than 9 million residents were evacuated. The institute also estimates that insurance claim payments will reach $22 billion.

Hurricane Andrew, the 1992 Florida storm considered the costliest natural disaster in U.S. history, wracked up $30 billion in losses alone, and its economic and demographic effects continue to this day.

Similarly, the 2004 season has had a lingering impact. Purdy says the local horde of contractors could not possibly take on all the necessary repairs in the area, which included $650 million in damage to the Naval air station and $80 million in damage to the school districts, opening up opportunity for businesses across Florida and beyond.

SKYROCKETING APPLICATIONS. The many out-of-state license plates that showed up at construction areas this winter came as a welcome sight. "I've seen roofing trucks out here from all over the country," says Purdy, who estimates as many as 200 came to Florida from other states to work after the hurricanes. Not surprising, considering that many Northern construction companies shut down in the winter due to weather constraints.

In Pensacola, the SBA and the Federal Emergency Management Agency set up a joint office in a church hall near Purdy's roofing company, and he says they've been "very visible" since the hurricanes hit, encouraging people to come see them and spreading the word about the assistance and loans available to those affected. "If anyone hasn't applied for help, it's not because it wasn't offered," Purdy says.

Plenty applied. Mitchel says when the first storm struck last August, his staff was at its lowest level in a decade. Within two weeks of the first hurricane, Jeanne, his staff ballooned from 400 to 2,800.

NINE STORMS COMING? "The logistics of responding to something on that scale was the most difficult part," Mitchel says. "To absorb that many people with training and travel arrangements was overwhelming."

With the National Hurricane Center predicting a 70% chance of an above-normal season this year, including as many as nine hurricanes, preparedness has been a top priority throughout the Southeast and along the East Coast. Florida Governor Jeb Bush recently signed legislation creating a tax-free shopping holiday on hurricane-preparedness items June 1-12, and each of Lowe's (LOW) 71 Florida stores plans to offer free clinics to teach homeowners and business owners how to install hurricane shutters, properly board up windows, and operate generators and chain saws safely. Alabama and Georgia have similar hurricane-preparedness weeks planned.

When Purdy speculates on the recovery effort in Florida going into the 2005 season, he says the morale level "probably depends on who you ask, but there's definitely a nervous energy in the community this week." Overall, says the lifelong contractor, "it's pretty amazing how people have accepted it and are moving forward."

The question remains, however: Can anyone be truly prepared for five more months of unpredictable, potentially disastrous conditions?

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