I noticed this small hole on the bottom next to the intake grate. How big of a problem is this? Also, what do I need to do to fix this, any recommendations? Is a hole this size taking in water?
If your worried about it, just get some clear or white window calk at any local hardware store, or at Wal-Mart. Put some calk on there and smooth it out. That will seal the area very well and it will look OK too. Some types take 24 hours to dry.
You simply chipped off a chunk of gel coat. I wouldn't leave it too long but you fine to keep riding around. Just purchase a small gel coat repair kit, and colour match as close as your able to before adding the hardener agent.
There are hundreds of videos online showing you how to perform gel coat repairs.