Opinions expressed by Entrepreneur contributors are their own.
It's the calm before the storm. Or is it? Like mosthomebased business owners, my wife and I haven't got a clue howthe Y2K bug will affect our business, let alone our clients. Whenit was safely in the distance, we were skeptical, tending to trustthat any problems would be minor and transitory. Now we're notso sure.
Why this Chicken Little change of heart? Smoke signals fromWashington, that's why--good news with ominous overtones. Thepresident recently signed a special bill approved by Congressearlier this year. The measure would provide an estimated $500million in guaranteed loans to help small businesses prepare forY2K computer glitches. That's great, right?
Not so quick. Here's the downside: Some studies haveestimated as many as 750,000 small businesses will be crippled orforced into never never land as their computers hit the 00 speedbump. Do the math--$500 million divided by 750,000. Needless tosay, competition for these loans could get fierce.
According to Rep. James M. Talent (R-MO), chair of the HouseCommittee on Small Business, many small businesses have yet to takeY2K seriously. But while they might feel safe from the Y2K timebomb, their customers and clients may be completely dependent onvulnerable computer systems for everything from production anddeliveries to billing.
Under the Small Business Year 2000 Readiness Act (Public Law106-8), the SBA can offer loan guarantees of up to $1 millionthrough some 6,000 lenders. Michael Stamler of the SBA says theagency currently backs loans with a "total indebtedness"cap of $750,000. Under the Y2K proposal, the maximum would beraised to $1 million. "That means if a small business alreadyhas SBA-backed loans of $750,000, they could still apply for anadditional $250,000 for Y2K," Stamler explains. The newprogram provides one year moratorium on principal payments, whereit will facilitate repayment, and provides that all"reasonable" doubts about the ability to repay will beresolved in the applicant's favor.
The SBA's Web site (http://www.sba.gov) already has a lot ofhelpful information on the millennium issue, with a link to the Y2Karea clearly marked on its home page. Check the site for updatesand further instructions on applying for a Y2K-preparedness loan,or contact your district SBA office or the agency's informationnumber, (800-827-5722). The SBA has also launched a fax-backservice to answer questions at (877) 789-2565.
Hot Links
Here are some other helpful Y2K sites:
http://www.Y2Krun.com - tipsand strategies
http://www.2000check.com -computer test and Y2K repair kit
http://www.year2000datasolutions.com- free tips, leads and links
http://www.tic-tocpro.com -fix for IBM-compatible computers
Contact Source
Y2K loans
Michael Stamler, SBA
Phone: (202) 205-6919 Fax: (202) 205-6913
Rep. James M. Talent (R-Mo.)
Phone: (202) 225-2561 Review copy: (Stephanie O'Donnell) Fax:(202) 255-2934
Kurt Samson is a freelance business writer and publicrelations consultant in Annapolis, Maryland.
