The U.S. Small Business Administration (SBA) is cutting through the regulatory red tape that has kept California wildfire survivors from rebuilding their homes and businesses. In a groundbreaking move, the SBA has announced new guidance allowing builders to self-certify compliance with state and local rebuilding requirements when they face extensive permitting delays. This initiative, announced under Executive Order 14277, aims to expedite recovery for those impacted by the devastating wildfires that ravaged Los Angeles.
In Los Angeles, an estimated 16,000 properties were destroyed in 2025, creating a pressing need for quick and efficient rebuilding. However, significant bureaucratic delays have plagued recovery efforts. According to SBA Administrator Kelly Loeffler, “Today, with President Trump’s leadership and alongside EPA, the SBA is opening an expedited path to recovery for every borrower who has been held hostage by the bureaucracy.” This shift in policy promises to allow survivors to cut through the current permitting backlogs that have been a major obstacle.
The impact of these delays is stark. Although the SBA has earmarked $3.2 billion in disaster relief for the area, less than a quarter of that funding has been drawn down due to permitting issues. As of now, fewer than 3,000 rebuild permits have been issued in the city and county of Los Angeles, leaving many residents stuck in temporary housing.
The new regulatory guidance allows borrowers who have waited for 60 days or longer for their necessary permits to proceed with rebuilding. They can have their builders self-certify that all required permits have been filed and that compliance with state and local regulations will be met. “By having their builders self-certify compliance with state and local regulations, survivors can immediately bypass the red tape, put their SBA funding to work, and begin rebuilding after more than a year of delays, excuses, and inaction,” Loeffler explained.
For small business owners considering the implications of this guidance, there are several benefits worth noting. First, it significantly reduces the time and cost associated with waiting for local approvals. For those struggling with financial constraints after a disaster, the ability to access disaster relief funding swiftly can mean the difference between survival and shutdown. This shift enables businesses to begin the rebuilding process much sooner, facilitating a quicker return to normalcy in affected communities.
The self-certification process is straightforward for borrowers. To utilize this new option, they will need to submit two key documents: a Disaster Loan Modification application and a Builder’s Certification. Once approved by the SBA, these documents will amend the borrower’s Loan Authorization, allowing them to bypass the usual prerequisite of local permits before they can start rebuilding.
However, while this change opens the door for rapid recovery, small business owners should be aware of potential risks. The guidance emphasizes that any false statements or misrepresentations can incur serious civil and criminal penalties. Builders and borrowers must ensure they adhere to all safety and building codes throughout the rebuilding process, as non-compliance could lead to further complications down the road.
Moreover, while this regulatory guidance is currently focused on the wildfire recovery in California, it sets a precedent for future disaster response efforts across the country. This means that small business owners in other areas facing similar permitting delays after disasters may find a similar option available to them in the future.
As the SBA moves forward with this initiative, it provides a glimmer of hope for those affected by one of the most destructive wildfires in recent memory. The ability to bypass local bureaucratic hurdles allows survivors to leverage the assistance they have been granted and begin the physical and emotional rebuilding process that has been long overdue.
For more details on this new option to expedite rebuilding in the face of permitting challenges, borrowers can visit the SBA’s official page: SBA Bypass Permitting Delays.
This regulatory guidance marks a significant step forward not only for the residents of Los Angeles but for small business owners everywhere who find themselves in the wake of disaster. Keeping an eye on these developments will be crucial as communities aim for recovery and renewal in the year ahead.
Image Via BizSugar
