SAN FERNANDO : Businesses Assessing Full Impact of Quake

The Northridge earthquake has dealt a more serious blow to San Fernando’s small business community than was previously thought, according to the city’s Chamber of Commerce.

Based on preliminary estimates, the temblor caused $12 million to $24 million in structural damage to businesses, said Bruce Cohen, executive vice president of the chamber.

“Let me tell you, that is just the tip of the iceberg,” Cohen said Friday. “We’re trying to take a look at what it will take to bring these businesses back, and that’s a lot of money. In addition, some businesses are up and running, but they’re on one leg.”

There are between 800 and 850 licensed businesses operating in the 2.4-square-mile city, and officials are bracing for a serious jolt to sales tax revenues, City Administrator Mary Strenn said.

San Fernando gets a 1% return from the state’s 6.5% sales tax--amounting to $4 million a year, Strenn said. That represents nearly a third of the city’s general fund--the part of the budget that pays for such things as police and daily operating expenses, she said.

“Sales tax is the most vulnerable,” she said. “A lot of the impacts we won’t feel immediately. It usually takes a minimum of a quarter (of a fiscal year) for sales tax receipts to be returned to us.”

City officials estimate that 12 commercial structures housing 14 businesses were destroyed; another 52 buildings housing 61 businesses have been deemed unsafe, and 25 structures with 35 businesses are posted for limited access.

Chamber and city officials fear that even those businesses that still can function might not survive the downturn in customer flow and the expense of replacing destroyed inventory.

“When you think about the fact that these businesses already had come through three years of recession, their cushion is gone,” Strenn said. “Their staying power is depleted.”

Still, not all is doom and gloom. Construction and repairs could bring in more tax receipts and boost some businesses. The chamber also has found some of the businesses it is helping are more willing to join and pay dues, Cohen said.

And, perhaps following the adage “If life gives you lemons, make lemonade,” the chamber will hold a seminar next week to delve into ways to use the earthquake as a marketing tool.

“There are certain things you can do after an earthquake to improve business, like earthquake sales,” Cohen said.