i can't see the picture but i've dealt with quite a few resto jobs in the past, there are a few options if you have the resources, and considering your skirts would cover any mess ups you could have with painting i wouldn't sweat doing it yourself.
obviously grind and repaint it, if you go this route i'd recommend a high zinc primer over the affected area, that will prevent the rust from spreading as quickly. its rusted once and unless you cut the metal and weld new metal into place the chances are pretty high you'll get it again.
another option you have is a chemical that will actually kill the rust, does mean you'll have to grind a slightly larger area first, but it does turn rust into a sandable/paintable surface. can't remember the name off the top of my head but they do carry it at most paint stores. again this wouldn't last forever, but for a quick fix for the next few years it should hold up fine.
as was stated earlier, its all a matter of how much money you want to spend and how long you need it to last.