Marshall fire still affects small businesses in Superior and Louisville
Louisville restaurateur Emilio Perna was looking forward to a very profitable New Year’s Eve. His restaurant, Parma Trattoria, had 300 reservations from local customers eager to celebrate the start of 2022.
Perna planned to spend December 30 making final preparations for her big day. At around 11 a.m., he walked out of his restaurant, at 1132 W. Dillon Road, and smelled “a little smoke” and heard fire department sirens in the distance. It didn’t seem close, so he went back inside. At noon, the members of his staff asked him to evacuate the restaurant. The Marshall Fire had arrived at the Village Shops in Colony Square Mall.
“The whole restaurant was surrounded by a cloud of black smoke blown by the wind,” he recalls. “It was a nightmare. The ashes were going into your eyes. You couldn’t see in front of your face. The way the fire spread and the destruction was unthinkable.
The devastation caused by the Marshall Fire has become national news. About 1,080 homes burned in Superior and Louisville. Boulder County, Louisville and Superior jointly released a list of seven businesses that were completely destroyed and 28 that sustained damage. Businesses destroyed included Element Boulder Hotel and Tesla in Superior, and Subway and Royalty Nails in Louisville. Damaged businesses included La Quinta Inn & Suites and The Rotary restaurant in Louisville, and Target and Chuck E. Cheese in Superior.
A recent survey of 201 businesses in the fire zone by the Northwest Chamber Alliance found that 23% were not yet fully open for business.
“Every person at Superior, every business, has been impacted by the fire,” said Deana Miller, executive director of the Superior Chamber of Commerce.
The impact has been particularly harsh on small businesses. Like residents who have lost their homes, most businesses rely on insurance to cover their losses. Some business owners encounter problems in this area.
Miller recalled a Superior restaurant that was closed for three weeks while it waited for damaged equipment to be replaced, losing about $40,000 in revenue. This new equipment cost $8,000, but the homeowner’s insurance deductible was $10,000, so the homeowner had to pay out of pocket.
Parma was closed for 10 days, Perna said. His losses piled up and he had to throw away $50,000 in spoiled food. It continued to pay its employees, even though it was closed.
“My employees have been with me for a while, and it’s not their fault that there was a fire. Their livelihood is this trade, just like mine,” he said. “We have a good team and I wanted to make sure they didn’t miss any paychecks, even if we had to advance the money before we got our insurance.”
Perna also had to replace equipment and clean the interior and exterior of his restaurant. He’s spent around $100,000 so far. He expects his insurance to cover these costs, but he has not yet been paid.
Wayne Shelnutt, owner of Wayne’s Smoke Shack, is in an even tougher spot. His barbecue restaurant in Superior remains closed. The house he was renting in Superior was completely destroyed, along with his Jeep. He has already received insurance payments for the house and the car. He received partial payment for his business losses, but his insurance company told him that large claims like his normally take 24 months to fully settle.
“I feel like I have good insurance, and I think this will get my due, but as anyone who has had insurance claims knows, you have to defend yourself and basically fight your way out. through this or they try to avoid paying you,” he said.
“The insurance company felt that everything in my restaurant should be completely thrown out and replaced, but they are fighting against the kitchen equipment, which my restaurant is based on. They just want to clean it up when it’s damaged beyond repair,” he said.
He is looking forward to an inspection by the Boulder County Public Health Department, as he expects that agency to require all of his equipment to be replaced.
Even businesses that weren’t directly damaged by the Marshall fire are feeling its impact. Burnt homes represent approximately 8% of the populations of Louisville and Superior. Many of these families had to temporarily move out of the region. Because people tend to eat and shop close to home, this forced migration has had a real impact on the region’s business community.
According to the Northwest Chamber Alliance survey, 38% of businesses have experienced a reduction in customer demand since reopening. This was Perna’s experience.
“We had the worst January we have had in seven years. The fire was worse than COVID,” he said. “January to February was a very dark time. I had to let a few people go, schedule fewer people.
“I have spoken with many of my friends who own businesses in the area, and with the upheaval of people having to move because they lost their homes, all businesses in the area near the fire are down. 30-50% revenue just since the fire,” Shelnutt said. “The business community here is in big trouble.”
State and federal support
Businesses that have been damaged or destroyed by fire are eligible for loans through the US Small Business Administration. That eligibility came after Colorado Governor Jared Polis declared a state of emergency the day of the Marshall fire, with President Joe Biden’s subsequent declaration of a federal disaster.
Although the March 2 deadline to apply has passed, eligible businesses can borrow up to $2 million to repair or replace damaged or damaged real estate, equipment, inventory and other business assets. destroyed. To date, the SBA has approved nearly $5.45 million for 30 companies, Kara Powell, the governor’s deputy press secretary, wrote in an emailed statement. But Miller said taking on a lot of debt just doesn’t sit well with many small businesses, despite the very low interest rates on SBA loans.
“These small businesses don’t want to take out a loan if they don’t know if they’ll be in business next year or two years from now,” Miller said.
Shelnutt considered federal aid, but ultimately decided the available options weren’t working for him.
“Right now I’m running a debt-free business, so my goal isn’t to take out a bunch of loans,” Shelnutt said. “We have already received beatings. We have already descended. We are already not open. I understand that the SBA offers attractive (loan) rates, but it’s still the debt that must be paid in full plus interest. So at this point we’ll try to work with what we get as an insurance settlement.
Construction of replacement homes may not begin for another two years, Miller said, meaning many displaced families won’t return to local shops or restaurants for years, if ever.
“It’s a very long-term problem,” she said.
This long-term problem – and the sheer scale of the disaster – has prompted tens of thousands of donations to charity fundraisers for the benefit of fire victims, donations from around the world. As of March 10, the Boulder County Community Foundation has raised more than $36 million from more than 74,000 donors.
The money is intended for immediate and long-term support. So far, the Community Foundation has distributed nearly $8.2 million for immediate relief, or about 23% of funds raised. The grants are designed to meet a wide range of needs – people whose homes have been damaged or destroyed, tenants or owners who have been displaced due to smoke or ash contamination, and people whose jobs have been affected. Small businesses that have been destroyed or damaged, including home-based businesses, may be eligible for a payment of up to $2,500.
So far, $122,500 has been distributed to 50 small businesses, including home-based businesses, Boulder County public information officer Jodie Carroll wrote in an emailed statement. This means that small businesses received about 1.5% of the Community Foundation’s aid money. Boulder County Housing and Human Services distributes relief funds on behalf of the Community Foundation and Elevations Credit Union.
Small businesses need more financial support, said Upper House’s Miller. She said her organization is considering starting its own foundation to raise money specifically to help local businesses. Creating an Adopt-a-Business fund would give people who want to support local businesses specifically a way to funnel money to small businesses in need, she said.
Although the financial support they have received so far may be disappointing, local businesses say they have received a lot of emotional support from their customers.
“Because we’ve been here for 10 years, we have really good support from the community,” Perna said. “My phone was ringing like crazy during the fire because everyone wanted to make sure everything was okay.”
When customers learned that Shelnutt’s home had also been destroyed – including her daughter’s Christmas presents – some dropped off replacement gifts.
My wife and I “have not had a ‘normal’ for the past three months,” he said. “It’s been very taxing on us mentally and emotionally, but luckily we have an incredible support group of our family and friends who are there for us. It just helped us bounce back much quicker than expected with all that has happened and how traumatic this experience has been.