By LUBNA TAKRURI
The Associated Press
Wednesday, May 2, 2007; 7:24 AM

WASHINGTON -- Every day for 15 years, Jose Canales and six family members would wake up before dawn and go to their three stores at the historic Eastern Market. But at 5:30 a.m Monday, Canales got a call from his daughter, who told him the building that was their livelihood was burning. The family arrived to find it gutted.

"We're heartbroken," said nephew Carlos Canales, 25. "It's like losing a home. We spent half our time there."

The fire, which was caused by an electrical short, displaced 13 merchants of fresh produce, meats and poultry from the 134-year-old brick building on Capitol Hill.

Within hours, Mayor Adrian M. Fenty vowed it would be rebuilt. City and federal officials scrambled to find money. Sen. John Kerry, D-Mass., chairman of the Committee on Small Business and Entrepreneurship, encouraged the city to seek loans from the Small Business Administration.

Neighborhood residents formed a foundation to help the merchants stay afloat. The 44th annual Market Day celebration will be held Sunday as scheduled, with many vendors working on the street outside.

A day after the fire, the spirit among the tight-knit family at one of the city's most popular destinations was one of survival. But the questions were tough: Where will the $20 million to $30 million for restoration come from? And how will merchants get by for the two years estimated for repairs?

At a news conference, Fenty outlined some of his plans, including forgiving the merchants' first-quarter sales tax and suspending their rent. Part of the money to rebuild will come from surplus tax collected last year.

Among the biggest rebuilding concerns is a sprinkler system. A renovation plan that was 90 percent complete before the fire called for sprinklers, which the building lacked.

"Simply put, they were not required when this building was built," Fire Chief Dennis L. Rubin said.

Eastern Market, listed on the National Register of Historic Places, was built in 1873. Until the fire, it was the longest continuously running public market in the city, predating grocery stores.

People came to Canales Deli for rotisserie chicken, topped with a green sauce that Jose Canales said "would set your mouth on fire." At Market Lunch, known for crab cakes, fish sandwiches and pancakes, Sen. James Inhofe, R-Okla., was a regular.

"We're all like a big family," said Market Lunch manager Nana Elgendy, known to many as "the mayor of Eastern Market."

Inside the market's long hall of food counters Tuesday, the walls were black, sunlight streamed through the demolished roof and charred ceiling fans hung over a seating area of burned bar stools.

Elgendy and Market Lunch co-owner Tom Glasgow surveyed the damage. Plastic cups were melted, takeout containers were blackened and illegible newspaper articles collected over decades sagged in their frames.

Firefighters helped the two gather what they could.

"We will survive," Elgendy said. "We're gonna get through."