Governor Mike DeWine and Lt. Governor Jon Husted today announced the Ohio Development Services Agency (Development) will release $10 million to Appalachian Growth Capital (AGC), a Community Development Financial Institution headquartered in Nelsonville, Ohio, to create a low-interest loan program to help small businesses impacted by the COVID-19 crisis in Ohio’s 32 Appalachian counties.
“Our priority is to help Ohio businesses and the people of Ohio. These funds will do both by helping businesses weather the current crisis and keeping Ohio workers on the job,” said Lydia Mihalik, Director of Development.
The new loan program is not designed to compete with commercial lenders but instead is an option for businesses when conventional financing is not available. Additionally, AGC is able to partner with commercial lenders to support a business’ efforts to retain and create jobs.
“This infusion of funds will allow our organization to provide low-cost financing to help small businesses retain and create jobs in the current COVID-19 environment,” said Brad Blair, COO & EVP, Appalachian Growth Capital. “We appreciate Development’s support of this initiative to help eligible borrowers keep their businesses operating, and in some cases, growing,” Blair added.
The program has specific eligibility requirements and will be made available only to businesses with less than $40 million in annual sales. The program requires the borrower to commit to retaining or creating jobs as a term of the loan. The program cannot be used to refinance existing debt. AGC will use standard underwriting guidelines when considering loan requests with an emphasis on 13-week cash flow projections.
“This is exciting news for our sister organization and the region we serve,” said Mike Jacoby, Ohio Southeast Economic Development (OhioSE) President. “Small companies have been hit the hardest and we thank Development for providing AGC with the ability to help more of them throughout southern and eastern Ohio.” OhioSE is the regional JobsOhio Network Partner providing economic development work in 25 of the 32 counties AGC covers.
“In addition to providing financing, we will meet quarterly with our borrowers to assess their progress,” Blair said. “We want to support them and ensure they are successful as they operate in the COVID-19 environment with its challenges and opportunities.”