A new Montgomery County program will provide small, disadvantaged businesses with financial assistance and educational support services to help keep them viable, grow their operations and expand their payrolls.
In May, the county will roll out a micro-grant pilot program that awards small, for-profit companies grants worth between $2,500 and $25,000.
Small businesses — especially those owned by women, minorities and veterans — often struggle to fund investments that can lead to economic growth, said Judy Dodge, president of the Montgomery County Board of Commissioners.
The micro-grants will assist disadvantaged companies buy machinery, computers, technology, signs and other fixed assets.
The program is an outgrowth of the county’s MCOFuture strategic plan, which calls for greater focus on and more services for small businesses, Dodge said.
“Small business is the backbone of our community,” Dodge said. “We’ve got to pay attention to our own small companies — we want them to stay and prosper.”
In addition to offering small grants, the county also plans to open a new business solutions center to provide resources and outreach for companies of all sizes.
The micro-grant pilot program will help local companies in the county — excluding Dayton and Kettering — expand by buying equipment, inventory and funding other capital needs, said Erik Collins, the county’s director of community and economic development.
Collins said a little money can make a big difference for small companies, which generate many new jobs across the region and state.
About 54 percent of firms in Ohio have fewer than five employees, though these companies only employ about 4 percent of the state’s workforce, according to U.S. Census data.
“This is another way to support our own companies,” Collins said.
To be eligible for the program, companies must have five or fewer employees and meet socially and economically disadvantaged requirements, Collins said.
The firms must be owned by women, minorities, veterans or people who face social and economical obstacles, such as cultural bias.
Eligible companies must have good credit, be up-to-date on their taxes and be at least one year old. They must have store fronts (no home-based or second income companies), and sales revenue cannot exceed $500,000.
Many disadvantaged companies have great business ideas and plans but lack sufficient access to capital, which can restrict growth and hiring, said Mark Anderson, with Montgomery County development services.
The pilot program seeks to be a critical financing source for very small businesses that may not have other options, officials said. Targeted sectors include retail, transportation, service industry and childcare.
A joint report by the Federal Reserve banks of New York, Atlanta, Cleveland, and Philadelphia found that the top challenge for small companies in businesses fewer than five years was the lack of credit availability that is needed to make key investments.
The county also has teamed up with Community Action Partnership of the Greater Dayton Area to provide “wrap-around” services for award recipients, Anderson said.
Services can include educational courses on topics such as money management and business plan development.
The county has $300,000 to distribute over the next three years, including $100,000 in the first year. The entitlement funding comes from the U.S. Department of Housing and Urban Development (HUD).
If the pilot is successful, the hope is to expand the program and make it permanent, possibly by pooling money from local communities to increase the number of awards, Anderson said.
“If we can show this program has some wheels to it, I think we’ll get other jurisdictions involved and have more money,” he said.
At the same time, the county also is in the process of establishing a Business Solutions Center, which will be staffed by employees from the county’s economic development and workforce development departments.
On Tuesday, county commissioners approved a lease for 12,075 square feet of office space at the Medwork Occupational Health Care building, 1435 Cincinnati St.
The center, located near the University of Dayton Arena, will offer a variety resources for local businesses and will connect them with employer services and other businesses for networking opportunities.
Companies will be able to receive services such as marketing consultation and assistance obtaining permits, Anderson said. Companies may need help finding workers, targeting customers or applying for a loan.
“It’s kind of business concierge services,” Anderson said.
The center is expected to open in the next several months.
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