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Endless rain, flood threats dampen business bottom lines

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Jerry Palm, 60, of Loman
Jerry Palm, 60, of Loman arrives at the flood confluence of the Rainy and Black Rivers to help sandbag the Loman Fire House Monday morning.
John Enger/MPR News

More rain today and Thursday will add to already drenched soils and brimming lakes in much of Minnesota. 

As the state surveys the damage from weekend storms in the northern and southern parts of the state, some businesses are looking at slimmer margins and fewer customers.

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One of those businesses, Sandy Point Lodge on Lake Kabetogama south of International Falls,  has had a tough open to the summer season, said owner Jennifer Gelo.

"We're figuring at some point it will back off and we will catch our breath," Gelo said. "We're just, at the moment done trying to guess when that will happen."

The resort's docks are underwater, their main lodge, restaurant and bar are sandbagged, and water surrounds their largest rental cottage, Gelo said. She doesn't yet know how much it will cost to repair docks and some buildings, but she expects resorts that depend on a full summer tourist season are going to be hit hard.

"People are going to be stretched very thin to come up with the funds that they need to put things back together," she said.

St. Louis County officials said there are between 10,000 and 15,000 sandbags in place around properties at Kabetogama and lakes nearby. At Sandy Point Lodge, the guests have been happy to pitch in with sandbag placement.

"I've lost count of how many of our guests have spent time filling sandbags, and helping us," Gelo said. "They've just stepped right in and helped. We didn't ask. We just set to work and our guests just walk right over and pitch in and start to help. It's a bad situation water-wise, but a good situation as far as knowing support you have."

Damage estimates

Across the state, officials are just beginning to gauge the amount of damage to roads, bridges and other infrastructure.

  "When you look at how many days in a row we have had damage from this whole storm system, and its not done yet. We may exceed that $7.3 million and actually qualify to request a presidential declaration," said Minnesota's Director of Homeland Security and Emergency Management Kris Eide. 

The federal disaster declaration can trigger funds to repair public infrastructure that local governments would have to pay to fix.

Businesses have fewer options.

Beyond private insurance, there's the Minnesota Investment Fund, which has flood recovery financing. After flooding in the northeast part of the state in 2012, qualified businesses were able to take out interest-free loans to repair damage.

Just south of Luverne, Minnesota, where nearly 8 inches of rain have fallen since Friday, Rock County Implement store manager Dan Block said his shop's display lawn had more than 4 feet of standing water earlier in the week. 

The John Deere dealer had some machines sitting in water, but his bigger worry is how much damage his customers have had.

"We're talking some major destruction in the hail. I got customers [who] farm 5,000 [acres] and maybe have 600 left. So is it going to hurt? Yeah, absolutely," he said. "The first thing they're not going to buy is equipment, obviously. We'll be affected, but we'll go on."

In Luverne, corn stalks and hay carried by storm water now block sewers and culverts, and many houses in town flooded, said Mayor Paul Baustian.

"Even on the high ground we had housing that was flooded upwards of 2 to 3 feet in the water, some 5 feet in the basement," he said.

For those in Luverne and so many others cities and towns who have had wet basements and worse this year, there are businesses to deal with that problem -- businesses seeing a silver lining in the clouds. 

One of them is Northern States Basement Systems in Duluth, where Dwight Gruetzmacher and his wife sell and install sump pumps. This spring, Gruetzmacher was about to start a second business, but demand for sump pumps was so high he had to put the launch on hold.

"You know, one man's bad is another man's good, and it's definitely good for us. We already have as much business on the books right now that we did all of last year," Gruetzmacher said.

In International Falls, Gov. Mark Dayton met Tuesday morning with Koochiching County officials and toured flooded areas. Dayton was ferried across 200 yards of flooded Route 11 to see sandbagging efforts at the Loman Fire Station, which sits near the confluence of the Black and Rainy Rivers.

The station is one of between 60 and 75 structures surrounded by sandbag dikes along the Rainy River and Rainy Lake shoreline according to Koochiching Sheriff's Department Capt. Jon Froemke.

According to a U.S. Geological Survey gauge at Manitou Falls, the Rainy River has climbed another inch since Monday, setting yet a new high water record. Previous flood records on the river were set back in 1950.

The threat of severe storms remains in the forecast for southern Minnesota for Tuesday afternoon and evening, with more thunderstorms predicted for Wednesday and Thursday, and showers forecast through the weekend. Northern Minnesota caught a break Tuesday, but thunderstorms are forecast for Thursday.