We’re Not Saving Lives. We’re Saving Livelihoods

Introduction:

In this week’s bonus episode, David Billstrom and Matt Raker, two business leaders who have played important roles in Western North Carolina’s attempt to recover from Hurricane Helene, talk about what we’re still figuring out about disaster recovery. The world tends to move on pretty quickly after an event, but the economic recovery can drag on for years. And it can be especially devastating for smaller businesses. The data from other catastrophic storms, David tells us, suggest that more than half of the small businesses in the area could be gone within a year. And of course those odds are not improved when insurance companies find ways not to pay claims and when government takes too long to respond. As you’ll hear, at the time we recorded the conversation in mid-December, the U.S. Congress still had not appropriated funds to help. That did finally happen at the end of December, but it’s still tempting to ask: Shouldn’t we be getting better at this?

— Loren Feldman

Guests:

David Billstrom owns a consulting firm called Flashing Red Light.

Matt Raker is executive director of Mountain BizWorks, a community development financial institution.

Producer:

Jess Thoubboron is founder of Blank Word.

Full Episode Transcript:

Loren Feldman:
Welcome David and Matt, our special guests today. It’s great to have you here. You both have had intimate views of what Helene has done to the businesses of western North Carolina. Maybe you could start by telling us about what roles you played. Matt, you first, tell us about—maybe, tell us what a CDFI is, and then tell us what yours does.

Matt Raker:
Yeah. Sure, yeah. So I work for an organization called Mountain BizWorks. And as you said, we’re a CDFI, or a community development financial institution. So we’re a nonprofit, a mission-driven small business development organization. We really believe in the power of entrepreneurship as a pathway to economic opportunity, and we work all across what we call Western North Carolina, or the mountains—the Appalachian Mountains region of North Carolina.

We’ve got our main office in Asheville, but we serve the whole mountains region, which is a very rural region, a very small-business-driven region. Like 99 percent of businesses in our region are small businesses, and so CDFIs are a great resource for access to funding whenever bank capital is not available. And so, a lot of different scenarios where that comes into play. And we’ve seen CDFIs are a powerful type of entity, very useful after natural disasters, as we see now, and also saw during Covid a few years ago as well.

Loren Feldman:
So it’s fair to say that you had relationships with lots of businesses in this area well before the disaster hit?

Matt Raker:
Oh yeah, 35 years of working in Asheville and across the region. So really, really deep relationships.

Loren Feldman:
David, how about you? Tell us a little about your background and how you came to know the community.

David Billstrom:
Well, I’m not from Asheville, but—I heard someone once say—”I got here as fast as I could,” 15 years ago. And I’ve had a long career in tech and venture capital, and I moved here with my own job working remotely as an advisor to entrepreneurs and executives, really all around the world, but largely not here. So this was before remote was a thing, and that meant that I brought… I think my rough count is 50 businesses now that I’ve either invested in or been a board member of or been an advisor to, over about 40 years. Everything from Walt Disney, where I was a vice president, down to operations that started in garages and stayed small.

So that breadth is really what has fueled my interest in the Asheville community, and along the way, I’ve spent much of my adult life in the outdoors. And that’s one of the reasons why I love being here in the Blue Ridge Mountains. And so many of the businesses I’ve been involved with are in the outdoor industry—either on the service side, providing experiences, or manufacturing clothes and equipment, and selling products at retail. So all of those businesses were affected by Helene, and that’s really the lens that I was looking at it during and after the event.

Loren Feldman:
You also have some background as a first responder.

David Billstrom:
Yeah, I have a not-so-secret parallel career, the same length, as a first responder. I got my EMT and did mountain rescue for the first time probably 43 years ago, I think it is. So I’ve worked at times as a volunteer. I’ve worked as a part-time and even a full-time first responder, and so during this disaster, for the first week, that was my role. And then we started shifting into the rebuilding role, particularly in the business community.

Loren Feldman:
Got it. So maybe you could both give me a little bit of a status report. I guess it’s been a little more than two months now since the storm hit. What’s the situation on the ground now? Maybe you first, Matt?

Matt Raker:
Sure. Well, we just got drinking water back in Asheville. So roughly two months without potable water, and so you can just imagine what that did. I mean, just a little bit of what we’ve been through: huge storm, major flooding, trees down, mudslides, landslides. There was a moment there where there’s two big interstate highways that cross through Asheville, one going east-west, I-40, and one going north-south, I-26, and where three directions were washed out, where the only way we could get out by highway was to go south, down toward Greenville, South Carolina. And we still have I-40 West, headed into Tennessee, still out. Probably will be out until sometime later in 2025. And then headed north, they’ve got one lane now reopened on I-26 headed into Tennessee, so have some connectivity there.

But yeah, there was no power for two weeks. For most folks, for most businesses, no water for about two months in Asheville, and similarly in a lot of other smaller communities, especially those along rivers and streams that had water systems knocked out, that had sewer systems knocked out. The storm was just about as bad timing as you could ask for.

You know, it was September 27 when it hit, which was going right into leaf season, which is one of the biggest tourism months for the region. And so, effectively, the governor on the first day said, “We’re closed for tourism. Don’t come.” It wasn’t safe for people to come. And we’re still down about 70 percent on tourism. We are now reopened, so please do think about coming back to the region. That’d be a great way to support Western North Carolina. We do encourage folks to come back. But, yeah, we’re still down around 70 percent. I’m sure we’ll get into it, but it’s been really hard for so many businesses just to kind of figure out: How do they navigate this? How do they get back to being fully open?

Loren Feldman:
Could you give us a sense: Walk us through Asheville a little bit. What would we see today if we were there?

Matt Raker:
Yeah, so in the downtown area we are, which is up on a hill, physically, it’s pretty good now. And now that we’ve got water back, we’re mostly able to be open again. And businesses are coming back. You know, there’s a lot of challenges still with numbers down with the number of people there. And then employees, there are a lot of people who had to leave the region during this because there’s no power, no water, whatever, and so still a lot of struggle to get employees back. But downtown looks okay.

Then if you go toward the river district, I mean, you could go down there, and you might think: Wow, the floods and the damage and the hurricane came through yesterday. I mean, there’s mud and debris everywhere. If you can imagine, the French Broad River runs right through Asheville. We’ve got the River Arts District, which is a really awesome arts and maker community, a lot of craft breweries and other folks. Totally underwater. Record water levels down there. It was a good 30 feet above where the river normally is. And so now, we’ve got the tree corridor along the sides of the rivers. And if you look 30 feet up, you can see where the river was, because there’s debris and trash and things all caught in the trees.

So you can kind of see the history of where everything was. And so, yeah, there’s still a tremendous amount of cleanup yet to be done. I think we’ve got the life safety stuff under control, mostly, and folks who lost their homes have been able to find at least temporary housing. So, huge progress in the community on that. But we’re really just at the beginning of being able to really recover economically, and that’s going to be a long, long transition.

David Billstrom:
You know, Matt, I think if you could categorize in aggregate, the size of the businesses, their annual revenue, the economic harm, just slowly and methodically, that would be a good thing for the 21 Hats community to hear. Like, we are them, they are us. They may not realize that. It’s pretty abstract, unless you’ve been here.

Matt Raker:
We’re running a grants program right now and trying to get emergency relief out. And we opened it up. We got a little over 800 applications in this program. So we’ve got data from 800 businesses combined. Combined, they have $235 million in economic losses. So that’s an average of a little over $300,000 in losses between physical damages and economic damages per business. So $300,000 is the average. The median is closer to $85,000. So there’s some really catastrophic losses in there. The vast majority of these are businesses two and a half million and below, and really, a million in revenue and below. So, very, very small.

Loren Feldman:
And those damages that you’re talking about are physical damage as well as business interruption?

Matt Raker:
Yeah, so direct physical costs, and then thinking about a lot of businesses lost October, November, and then portions of who knows how many months until we really kind of get back up to where we were.

Loren Feldman:
David, do you have a sense of what percentage of the businesses that were in existence there before the storm are going to make it back?

David Billstrom:
Well, we have some data on that from Katrina and similar large scale events. And so I’m not disrespecting the quote-unquote average Florida hurricane. They’re all potentially catastrophic. And they’re all terrifying. And they’re all disruptive. But these events where we’re talking about over 100,000 structures significantly damaged or removed and over 100 lives lost, this kind of Katrina-scale event, there is some data, and it is sobering. So the data from Katrina is 40 percent of the businesses will not reopen in the first six months, or they’ll open and then close. And then I believe it’s within one year, another 20 percent will fail. So potentially, we could see as much as half of our businesses not be here in November of 2025.

Now, it would be foolish to ignore past history as we project the future. But we don’t necessarily have to have that happen this way, and it’s frankly one of the reasons why I’m so excited about having this discussion with you today, with Matt, that perhaps other regions in the United States that are facing similar catastrophic weather events can see them as catastrophic economic events. This is surely an economic catastrophe. And as Matt was saying, large swaths of the service economy employees are just not here. There’s either nowhere to live for the first couple of months, or if there was a place to live, there wasn’t a place to take a shower. And if there wasn’t a place to take a shower, a number of people aren’t really comfortable cooking at home. They depend on eating out, and there was nowhere to eat.

And then one of the things I noticed among many of my friends and colleagues, is if you have school-age children, you had to leave because there was no childcare and there was no school. Some of the schools opened—what, Matt, about the six-week mark?

Matt Raker:
That’s right, yep.

David Billstrom:
So, for six weeks.

Matt Raker:
Yeah, we enrolled our kids in Virginia schools, because they said it could be two, three, four months before schools were able to reopen, before they could get water back.

David Billstrom:
So, when the kids leave, at least one of the parents has to leave. Many families are two-income, even if one of those might be part-time. So that either is not here and working remotely or just not working. These issues are suffered more painfully the lower on the economic scale you go. And you can see it.

So even today, I notice at lunch, I don’t have a problem finding a table. And I try to eat out as much as I can to support the restaurateurs that I know. And I’m seeing them because they’re working in their restaurants, because they don’t have enough staff. But the restaurants aren’t full. The roads are full, but those are dump trucks and Caterpillar excavators and trailers and dust. So the streets are very, very busy, but it’s not with employees who live here. So the economic catastrophe is something we definitely want to focus on.

Loren Feldman:
Matt, the data that David referred to was based on the experiences of other locations during other disasters. Do those numbers, though, match up with your gut sense of what you’re seeing and experiencing talking to the businesses in your area?

Matt Raker:
Yeah, I mentioned we’re a real local, small-business driven community, and we’re passionate about our local businesses. And you know, that’s got some strengths, that’s got some challenges. So, on the challenges side, like we can’t call some headquarters, and say, “Hey, send us some money and bail us out.” But it creates tremendous relationships and community engagement and really strong customer bases that love their local businesses. So we’ve seen businesses come together and collaborate to kind of figure out how to navigate these challenges in all kinds of ways.

And the community, like David said, we’re all thinking about, “Hey, should we go out to eat tonight or go out to lunch?” And we’re like, “Yeah, let’s do it!” to really support our local restaurants and everything that’s reopened. And we saw this during COVID as well, because of how entrepreneurial and local-business driven we are, I think we’re gonna have many more businesses that are able to survive. And so we are absolutely gonna have losses.

I mean, we’ve had a number of folks and even anchor small businesses that are cherished, that are not going to be able to make it through some of the sheer amounts of challenges they’ve faced. But I think we’re going to be well below the hopefully 40-percent number or the 60-percent-after-a-year number. But that will require ongoing commitment to having the right relief programs and other kinds of support to help those businesses make it through. That’s what we’re focused on.

Loren Feldman:
David, I think you explained to me in another conversation what was different about this disaster, and that’s the sense that there are a lot of places that know they could experience a hurricane or a flood of some sort, and even they sometimes aren’t prepared for it as well as they should be. But they know. This was a total surprise. You’re in the mountains. Flooding was not anticipated, and I am pretty sure not that many businesses had flood insurance. Is that right?

David Billstrom:
Yes, and why would you in the mountains? Yeah, that’s a great question. And you know, the way I usually break it down—both with one foot in in the business world and one foot in the first-responder world—is the weather forecast was well-known to the degree that the first responders were requesting additional resources to be stationed in and around Asheville and western North Carolina and throughout the 25 counties before the storm.

So the morning of the storm on Thursday, the National Weather Service forecaster for this area came into work and saw the streamgages in Georgia as the storm moved north, originally from the Gulf, and could see that they were intensifying. The storm was intensifying, and that was a surprise. I’m no weather expert. I’m not even an amateur weather enthusiast. But my understanding is: Hurricanes have never strengthened. They’ve always weakened in this scenario. And in this case, it was strengthening.

Unlike Florida—this is the second component of the three issues—we don’t really know what to do with that kind of forecast in the area. So, do we tell everybody to evacuate? If so, how are they going to do that? Does everyone have a car? Despite the two interstates, they’re pretty small by interstate standards, and everything else are two-lane mountain roads. So it’s not even clear that evacuation is a good idea.

That really leads us to the third problem, which is they didn’t know where. So from my house in Black Mountain, which was absolutely one of the ground zeros, one of the multiple ones, we actually had tornadoes in the neighborhood—both evidenced on the weather radar and by the twisted trees in the aftermath. So tornadoes in the mountains at 2,500 feet and 5,000 feet—my understanding is that’s never happened before. And 20 minutes from my house to the east, no problem. Bad thunderstorm. That’s it. A little standing water on the road. Creeks overflow, quote-unquote flooding, as I think most people imagine flooding.

But up here at 2,500 feet and above, the tallest mountain east of the Mississippi is Mount Mitchell. It’s in my backyard, and that’s 5,000 feet above my house. And so that’s not flooding. That’s flash-flooding with tremendous violence and flow. And so it’s really the power and velocity, not the rising water. Many of the deaths were just the house, the structure, the person, the car, was just swept away—not rising waters quickly, like you see in the lowland floods. So all three of those components: the fact they didn’t know exactly where it would be, not even within 10 or 20 miles, and then, what do we do? Do we evacuate or not? I mean, I have a lot of respect for how Florida and other places that have experienced hurricanes at a coastal level are prepared. They have a mechanism. It’s days in advance. Everyone’s on the same page. We don’t have that.

I think we can in the future, but that devastation meant that we had everything from an outdoor retail business where the entire building was swept away and all of the contents—and as Matt mentioned, this is our busy time. October and November: That’s the time you make most of the money in the year if you’re in the outdoor business. And so not only was it lots of inventory, it was overfilled with inventory for the tourists and the holiday season. All gone. And then you have businesses that are untouched, but they don’t have electricity, they don’t have water, and they don’t have employees. So that’s that economic harm.

And then there’s another one that we haven’t mentioned, which is, there are 25 federally declared disaster counties. And there are many counties in Western North Carolina that were untouched, and they lost their October and November as well, even though they had power and water throughout the entire time, because public authorities—correctly, I think—told everyone to stay away, and they did.

Loren Feldman:
So, Matt, given that level of destruction and the unlikely scenario that any of these businesses had flood insurance, how does a business recover?

Matt Raker:
Yeah, that’s a great question. And just on the impact, one thing that kind of helped put this in perspective to me is the North Carolina Department of Transportation, they tallied up: In all the previous hurricanes and natural disasters in North Carolina—of which there’s been quite a few, especially in the eastern part of the state, hurricanes—they totaled up total damage to our transportation system, roads and bridges and whatnot, of $1.1 billion total, all everything pre-Helene. And just from Hurricane Helene, we’re already at $4.5 billion and still counting in damage. So more than 4x over the whole history of natural disasters in the state. Really stunning.

Businesses right now, it depends on what kind of business you are. We focused very early on on getting three main things, in terms of business support, up and running. One was, we just saw how deep the impact was, and so we said, “There’s going to need to be some grant support.” So looking at how the money that just helps folks pay some of the recovery costs, some of the rebuilding costs, and get some of that community support, too, behind them to know that we’re there for them. That encouragement to be able to come back.

Recovery loans as well, very important, because you’re going to need that working capital. You’re going to need to borrow to fix your building or replace things, get through the months that you lost and try to keep employees on. And then, we’ve been providing a lot of specialized recovery guidance, consulting effectively on supporting folks, just having a sounding board to kind of think through: How do they triage? What’s in front of them? How do they deal with filing different insurance things? How do they apply for SBA loans, and just navigate all the different programs that are out there? And I think we’ve done this not just at Mountain BizWorks, but all the small-business and entrepreneurial groups across the region.

I think one of the hallmarks of our region is we work together very well, because we are kind of a rural region, typically with lower resources. So we’ve got to collaborate to go further together. And so that really benefited us. We were able to quickly get together and figure out what’s going on, where’s everyone at, what do you need, and have really been collaborating on being there to support our businesses.

David Billstrom:
I really want to brag on Matt and his leadership team for just a moment, because I think this is a teachable moment for other regions. And when I first heard about BizWorks when I arrived, I didn’t even know that they had loans and micro loans. Their brand was so strongly associated with their education programs, which were collaborative and connected with the community college, the University of North Carolina university system support for small businesses. They didn’t compete with each other. They collaborated and supported one another.

And so that history, decades of history of education, meant that they were perfectly positioned to pick up the new challenge of educating an entire region on how to apply for a loan, how to apply for FEMA funds. This is not an area that most people even know what FEMA does, let alone how to do it. And so that education role, as Matt says, very generously, not just Mountain BizWorks, but the other small-business-support funds, the chamber of commerce, and so forth—I’m not sure we’d be here as far along as we are with the business community, if we hadn’t had that swing into action. And when I say swing into action, I mean, in the first week while we were still doing recovery work in first-responder agencies.

Matt Raker:
Yeah, one week after the hurricane, we launched an emergency bridge loan program. That was the first thing we were able to kind of get going, called the WNC Strong: Recovery Loan Program. Those are loans up to $100,000 so just kind of emergency working capital to help folks be able to get through the immediate months until some of the longer-term relief, the federal relief and whatnot, becomes available. We’ve had over a thousand businesses apply to that. We’ve already approved for and funded 460 of those—and so over $26 million deployed across our footprint.

And now we’re really thrilled to be also now rolling out some grant programs as well. I think we’ve got right around $4.5 million raised thus far in grant programs going out in the region, and those are going to be business saving. Those are going to make the day for so many businesses to have a little bit of grant support, but we need more. You know, that’s just the start. Just in our program, we’ve got over $18 million in requests on the grant side. So we’re going to need a lot more. But those two programs also give us a ton of data that’s really helpful to kind of see exactly where the need is, and to be able to tailor our response and help business owners also kind of think about how to put their situation in context and think about how they can really put together a plan to get reopened or stay resilient through this.

David Billstrom:
Yeah, so 460 loans made in roughly—not even 10 weeks. That’s not the applications. There were more applications than that, presumably. So I would challenge any region in the United States to process, from zero, that kind of rate. And my understanding, Matt, is part of that was because you already had the test run with the pandemic.

Matt Raker:
Yes. I think being able to have some of those programs, those frameworks, and the gray hair, and everything that goes along with running a disaster program. But having some of those skills available is key. CDFIs across the country were on the front lines during the pandemic. And I think nationally, we’re going to have more natural disasters. You know, there’s just gonna be more climate impact, more things. So I think all communities really need to be thinking ahead of the disaster.

And even though we’ve been able to use some of the playbook from previous, we’re still inventing a lot of stuff as we go, after the disaster, which is the worst time to be able to create a program—when you’re also navigating a crisis and everything. But yeah, I think, really encouraging folks to be thinking, just like we do on the life safety side of emergency-services preparedness: On the economic-recovery side, what does that resilience for our community look like? And I kind of say, it’s like we’re not saving lives, but we’re saving livelihoods, because we know so many of our small businesses and the jobs they support really are the backbone of our economy here.

Loren Feldman:
I want to ask you a couple of questions about recovery loans. One is, I believe I’ve been reading that the SBA disaster loans are depleted at the moment and not available. Is that still the case?

Matt Raker:
Yeah, yeah, you brought up a real sore topic for us. Yeah, we’re not very happy about that.

Loren Feldman:
And that’s awaiting appropriation from Congress, I assume?

Matt Raker:
That’s right, yep. SBA, really since Maui, has been saying they are running out of money. So SBA, the U.S. Small Business Administration, runs a disaster loan program, which really is the main recovery tool for small businesses. Because typically, maybe you can get some local grants or things like that, but federally, it’s these disaster loans. And it hasn’t been available at all. It hasn’t been available at all. It ran out of money right when Helene hit. You know, we also had hurricane Milton in Florida right after that too, so they’ve had no money. And they’ve got something like 10,000 applications, so they’re still taking applications in tremendous demand. Normally, there would be hundreds of millions of dollars in relief flowing through that program, and we’ve had none. I mean, actually, technically, we’ve had $5 million, but that’s such a rounding error. It rounds down to zero, effectively.

Loren Feldman:
That must be incredibly frustrating.

Matt Raker:
Incredibly frustrating, yes.

David Billstrom:
So we have private foundations, and we were able to get some state allocation to fund some of the loans that Mountain BizWorks is doing now, and that is maybe another point of preparedness for the 21 Hats audience, which is, some of us are actively involved in advocacy at the legislature and with the administration at the state level—less so at the federal level, but we have some of that too—within the business community. And we’ve needed to reach out. And we have found the legislators, for the most part, want to know what we think. Some of them are business people, but many are not.

So for instance, there’s been quite a bit of fast education on behalf of us advocates explaining the difference between an SBA loan and a government grant. Because many of these small businesses were already servicing debt—as most of the 21 Hats audience is familiar with—with their existing business. Now, imagine servicing your debt, and then the pandemic happens. So then you take one of those government loans at a low interest rate, but it still has to be repaid. And then you lose the two best months of your year for revenue. Now, how do you feel about getting a loan where you need to sign a personal guarantee with your house?

That is the reason why we need the grants. Because there are some of our most experienced business people with traditional businesses that are loved and in a great location, this is tipping them over the edge. That’s it. I’ve been working for 10 years, or 20 years, or whatever it is, to create this business that employs people and funds livelihoods. And I’ve already had debt. I don’t have flood insurance, because I wasn’t aware I lived in Florida, and now my best option is to sign for more debt? So, it’s not free money from the government. It’s really bailing out the majority of the employers in the area, not unlike some very large scale government bailouts that have occurred for business in other sectors.

Loren Feldman:
That’s actually something I wanted to ask you about. The question really is whether recovery loans are even the right tool in the aftermath of something like this. There are plenty of businesses that got EIDL loans that were exactly as you said. They already had debt to service, and now you’re piling more on top of that. Who knows how sound their business model was before the disaster? It probably wasn’t improved by the disaster. What are we learning through this experience? Are recovery loans the right approach?

David Billstrom:
Well, I’ll let Matt answer in just a moment, but I wanted to give a little bit of local color. Right next to my town is another town where I worked in the fire department part-time for 10 years, called Swannanoa. And you may have seen Swannanoa in the news because it had some of the most horrific loss of life, and it’s a low lying valley with businesses built along the river. So it was one of about 10 communities where more or less all the businesses were just swept away. And so their recovery is going to be measured in years, not months. And the issue is, in that community, the fire department now will be forced to look at letting firefighters go, and it’s a rapid chain of events.

They have to look at reducing their costs by letting personnel go, because that’s the biggest cost in a fire department. And they’ll have to do that because the revenues for the expenses of the fire department come from taxes on income and from sales tax. And in our state, roughly half is from sales tax. Well, the sales tax has to be earned in that region, in that fire district, and most of those businesses are gone, so there won’t be any sales tax revenue. So when that happens there, we’re going to need less school teachers and less people working in the stores. And you can see how this starts to spiral down. So it’s actually not a loan. It’s an investment in the future—taxation and support for other jobs in the region—because it ripples outwards.

Matt Raker:
Yeah, that’s a good point, David. I mean, there’s huge costs down the road if we don’t act to save the fabric of small business that we have. I mean, the lowest cost time is right away, to get that recovery capital to businesses. And I think we definitely have to be looking at not just recovery loans, but think about the forgivable paycheck protection loans during the pandemic—hugely important to so many small businesses. And so, we think about, how much do we spend on economic development to create new jobs in our communities, to attract large employers? Well, recovering these jobs is like the biggest economic opportunity we have right now.

So many of our small businesses, they’re people’s retirement funds, they’re kids’ college funds. It’s everyone’s house mortgage and their rent. And so, if we lose those, those are going to be devastating long-term consequences in the ripple effects. As David said, if those employees leave, or those families leave the communities, then your schools start losing children, and then they start losing funding. I mean, you get into a vicious cycle there if you don’t act and act at the level that’s really needed. So, we do think we need to look at things beyond just loans.

Loren Feldman:
In this environment, have you guys seen examples of the kind of entrepreneurial resilience that we all saw after or during the pandemic? What are entrepreneurs doing in your area to survive that you’ve noticed?

Matt Raker:
First off, so many of our restaurants, I don’t know how they did this. They just figured out a way to just make meals and give them out to first responders, to give them away for people in their neighborhoods, and they weren’t charging anything. And then they had to kind of figure out, “All right, well, how do we get water?” And there was a whole series of different entrepreneurial solutions for how to do that.

We had people having all these totes popping up at all your restaurants, these big containers where you could have potable water there. And then people in other nearby communities, they would fill up several of these or tankers on their trucks where they could get water or well water. And they would drive around Asheville, for example, and refill these businesses every day. So it’s like a whole little cottage industry around that.

David Billstrom:
Dollar a gallon. Dollar a gallon.

Matt Raker:
Yeah, there were some big businesses, but there are also some small businesses that were just able to connect the dots between these people who have well water or access in a town that was less impacted. We’re gonna truck it in every day. You know, we’re pretty happy and proud about our craft breweries that we have here, which obviously takes a lot of water to make beer. And several of those, if they had water, or they were able to with partners get tanker trucks of water to come in from other breweries from out of the region, they’d say, “Hey, we’re gonna fill up. We’ll bring you a tanker load of water.”

And so, they were bottling water before we were able to get a lot of the kind of water supplies here. Now, we have enough water bottles. Now, please don’t send any more water bottles. But that was so important. And then they were figuring out how to get that to different places so they could get some level of operations back up and running again, just trying to do something to get back open.

David Billstrom:
I think some of the entrepreneurial improv that I’ve seen has revolved around transitioning from those free meals to selling meals to selling meal experiences. And just like Covid, where restaurants switch to a counter model instead of a table service model, same kind of innovation: restricted menu, able to get it for go. World Central Kitchen came, and I don’t know if you’re familiar with their model, but they employ local chefs and restaurant owners so that they and their staff stay employed to make the food that World Central Kitchen gives away. And we also saw some of the stores, some of the retailers that saved their inventory, were able to turn around and have a pop-up location outside of the direct flood zone, but staying in the region.

Loren Feldman:
If there was one thing that you could change about the way this country responds to disasters, what would it be? What’s the one thing that you’ve learned from this that you would most want to emphasize, either of you?

Matt Raker:
For me, it’s you don’t want to be coming up with your disaster response programs in the middle of a disaster. And that’s been so much of how we’ve been doing it across the country, particularly on the economic-recovery side, how we support businesses and entrepreneurs. We need to really have some tools and systems that are available for communities all across the country.

So, how do we learn some of the best practices from areas that have figured out some of these things that work? We’ve certainly got some lessons here. We got some things that we don’t want to do as well. But I think being more ready there, so that when communities—hopefully they never do have one of these, but we know that there are more and more of these types of events happening, that there’s more of those off-the-shelf kind of tools. And we can be more adaptive and respond quicker and do a better job saving more of these businesses and not having those long-term impacts.

Loren Feldman:
How about you, David?

David Billstrom:
Well, I don’t know that I have a simple answer. I think it’s part of what Matt said. That economic disaster of the pandemic illuminated really how America works: that the service economy is largely populated through small business, not large business. Yes, there’s lots of McDonald’s, but the vast majority of the folks work in smaller restaurants. And those restaurants, as we learned in the pandemic, painfully, only have two or three weeks of cash flow. So that response probably needs to be measured in weeks, not months. And the federal government and the state government are not set up for that. They’re just not.

And in the pandemic, I think the mistakes were made in the PPP structure. I personally know of some businesses with $20 or $30 million in revenue with fat margins and no real risk to their job force, that got PPP loans on the order of $2 to $4 million, which were forgiven. And it was just free money from the government. I don’t judge that, looking backwards, because we had so many success stories from PPP where businesses did stay and thrived and kept people employed, and we did not have an economic disaster that we might have had. But looking forward, I think we would like something a little more accurate, a little more precise, a little more efficient than the PPP program that was thrown together—which, by the way, took longer than two weeks before the first check started arriving.

I don’t have the solution, but I have the problem statement. You know, in my work with business owners of all sizes, insurance is not our first topic, but it’s not our last. And one of those pieces of insurance that’s a big surprise is that your property insurance and your general liability insurance is not going to help you when there’s a flood. That’s an out.

But what was shocking to at least four business owners that I know intimately well, in all four cases, they have yet to see a claim approved for their business-continuity insurance, which, as most in the 21 Hats community would know, is very expensive insurance. I’ve only bought it once for one business. It didn’t make sense for the business model for the other businesses. And all four of those business owners stretched and paid the premiums, and they are not seeing claims. Because in the policy deck sheet, there is an exception for flood, and one of those four didn’t have any flood damage. They just didn’t have water or electricity from the town. They didn’t have water or electricity from the town because of a—you guessed it—flood. So, that’s the basis of that claim being denied so far.

Loren Feldman:
So the claim was denied even though they weren’t physically affected by the flood, but their access—

David Billstrom:
It was a derivative effect of the flood. So, we’re going to see some of this play out in the courts. But I think, fundamentally, business owners educating themselves on the limitations of their insurance and understanding that in these climate events, the insurance industry—as I have read in the business press more than once—has figured out climate change is real. And they have changed their policies carefully and methodically so that they don’t have to pay for it, and they’re not. I don’t think I’ve even heard of anyone getting any insurance claim.

Matt Raker:
And I’ll add one thing on the insurance thing. You can only get flood insurance if you’re in the flood plain. And what we saw was a lot of this damage was beyond the flood plain, where you can’t even get flood insurance, so that they’re totally uninsured. And that’s going to be more and more common, as we look at climate events. So we’ve got to really rethink insurance and make that really work better. Because that could be a tool that can be one of the key tools where you can get funding quickly, in theory, if we look at it and have it set up in the right way.

Loren Feldman:
Are both of you confident that Asheville will make it fully back and be the special place it has been?

Matt Raker:
Yes, our community has come together, and there are going to be hard times and things that are going to be different, but the strength of this community is so apparent, and we really rallied together. And we really do, like I said, invite everyone to start coming back, because we are open. And we want you to be a part of our comeback story.

David Billstrom:
Yeah, I agree completely. You can’t really kill the place, and you certainly can’t kill the culture, and it’s a culture of resilience. This region is an area that is culturally and geographically remote from the power centers in the South, but it’s where they come for vacation. So this is going to be fine, but it’s going to be painful. It’s going to be painful rebuilding. It’s going to be tough.

Loren Feldman:
And of course, it won’t be fine for everybody. Not everybody’s going to make it back.

David Billstrom:
It will not. And as usual, equity is going to rear its head, and people most disadvantaged are the ones who are going to hurt the most.

Loren Feldman:
My thanks to David Billstrom of Flashing Red Light and Matt Raker of Mountain BizWorks. Thank you for taking the time. I really appreciate it. If somebody wants to contribute, is there a place you’d recommend they go?

Matt Raker:
Absolutely. Thanks, Loren, yeah. People can go to wnc—as in Western North Carolina—wncstrongtogether.org, and you can see the latest of where we’re at with the recovery. And there’s a place in there to donate to impacted very small businesses across Western North Carolina.

David Billstrom:
Yeah, and I’ll add that any donation of any size really does make a difference. At this point, I’ll put a plug in for the outdoor spaces that are near and dear to my heart in outdoor recreation. We set up a fund, myself and some other folks, to fill in the gaps not covered for the outdoor spaces, and that’s rebuildblackmountain.org.

Loren Feldman:
Great. Thank you both.