Hurricane Sandy could be boon and bust for local businesses

Cleanup from Hurricane Sandy continues on Piermont Avenue Cleanup from Hurricane Sandy continues on Piermont Avenue in Piermont. (Oct. 31, 2012) Photo Credit: Angela Gaul

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Economic development officials say the lower Hudson Valley could see a major shakeout among entrepreneurs whose businesses are at a standstill due to hurricane-related flooding, loss of electricity or both.

Fortunes could change depending how long it takes the federal government to help the region, experts say.

In Westchester County, where 72 percent of all businesses have five employees or less, struggling entrepreneurs with limited resources will soon be "pushed over the edge," said Laurence Gottlieb, Westchester's director of economic development.

"If the electricity isn't turned on in the next few days or weeks, you're going to see this problem exacerbated," Gottlieb said.

Michael DiTullo, president of the Rockland Economic Development Corp., explained that Rockland's economy is equally dependent on small business, adding that "a lot of the manufacturing and biotech businesses do have backup generators" and that the generators are helping, for now.

In some instances, generators haven't been adequate. Rockland County Business Association president Al Samuels said one food processor called to say his generator isn't able to maintain adequate refrigeration levels and that his inventory is in danger of spoiling.

While getting electricity turned back on is clearly the number one issue for business leaders, other hurricane-related questions are starting to surface. Entrepreneurs are calling Samuels with concerns about insurance coverage. Samuels tells them to look for a business interruption clause that could cover some of their losses.

"It's contained in most of their policies and they don't realize it," he said.

Business leaders have been frustrated by lack of Internet and phone service, said John Ravitz, executive vice president of the Business Council of Westchester.

"People want to get powered up so they can have a line of communication," Ravitz said.

He said his organization is prepared to help with Small Business Administration loans and "other issues down the road."

The critical factor shaping the recovery of business in the Hudson Valley is the Federal Emergency Management Agency, which provides disaster relief to qualifying business and residential applicants and "can flood some dollars into the system," Gottlieb said. FEMA announced Thursday that it will pay 100% of the costs incurred by government entities in getting power and transit back, but the agency said little about businesses, so far.

Dan Conte, general manager of the 444-room Westchester Marriot in Tarrytown and president of the Westchester Hotel Association, said this week's closing of airports and trains led to many cancellations at regional hotels in the middle of their September-to-November busy season of fall sporting and tourism events, reunions and weddings. But the empty rooms were quickly filled by local residents displaced from their homes by the storm, Conte said.

"Our staffing is kind of stretched. I'm pretty proud of them," Conte said. "We have people who haven't been home since Sunday and we have people that are just starting to trickle in."

Business leaders and officials agree that restaurants are among the enterprises most at risk, because they operate on very narrow profit margins. But the storm has helped some food places. In the Sound Shore village of Rye, where Main Street has power, restaurants and bagel shops are booming, crowded with residents who have no heat or electricity.

"People are cold and don't have light. They're coming to get out of their houses," said Sally Wright, president of the Rye Chamber of Commerce.

The scene is the opposite on the redeveloped Hudson waterfront in Irvington, where Chutney Masala Bistro was flooded Monday night. Navjot Arora, who opened the elegantly appointed restaurant in 2008, is in shock over the damage caused by three feet of water. The flooding warped the wood floors and Sheetrock walls and knocked over three stainless steel kitchen refrigerators. Arora can't tell if the refrigerators still work because there is no power.

Four big parties booked for this weekend and next have been canceled, Arora said. But somehow, the Dobbs Ferry resident will make payroll on Friday for his 12 employees "because they are relying on me."

"It's a tough road ahead," he said. "It's going to be hanging on by my fingernails and hoping for the best, seeing what agencies can help us."

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