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Save our small businesses fund and program |
| Updated: March 31, 2010 |
The Rebuild Iowa Infrastructure Fund (RIIF) bill passed on the last day of session includes a package of provisions aimed at assisting small businesses. The details of the program and funding are summarized below.
SAVE OUR SMALL BUSINESSES FUND AND PROGRAM
Purpose
The purpose of the save our small businesses fund is to promote the creation and retention of jobs in the state's economy and to assist businesses to be more competitive.
The department of economic development shall establish and administer a program for purposes of providing financial assistance to eligible small businesses. It may contract with another organization to administer the program
Financial Assistance
"Financial assistance" means loans at an interest rate not to exceed three and nine-tenths percent per annum.
Financial assistance to a small business shall be at least two thousand five hundred dollars, but shall not exceed fifty thousand dollars.
The lending entity shall begin to provide financial assistance from the fund not later than August 1, 2010, and shall to the extent practicable obligate all available moneys in the fund prior to March 31, 2011.
A loan made to a small business under the program may be for any period of time, but the terms of such loan shall provide for the repayment of principal and interest prior to the date the moneys in the fund revert.
Eligibility
A business is eligible to apply for financial assistance under the program if the business meets all of the following criteria at the time of application:
o The business has thirty-five or fewer full-time equivalent employees.
o The business is located in Iowa.
o The business is owned, operated, and actively managed by a resident of Iowa.
o The business has a business plan and has received assistance in the development stage or the expansion stage from a small business development center or from a qualified public or nonprofit small business consultant as defined by the department.
o If a business has been a going concern for two years or more, the business has not been found to be in violation of any environmental or worker safety laws, rules, or regulations.
o The business only employs individuals legally authorized to work in this state.
o The business does not engage in the production, depiction, or distribution of obscene material.
o The business is not in bankruptcy and is not imminently contemplating filing for bankruptcy.
Contract
Upon approval of the application for financial assistance ", the eligible business shall enter into an agreement with the department which shall include but not be limited to all of the following provisions:
o If an eligible business, after receiving financial assistance, does not continue to meet one or more of the criteria for eligibility all or a portion of the financial assistance received is subject to disallowance, recapture, or immediate repayment.
o If, after receiving financial assistance, an eligible business ceases operations within the state or removes a significant portion of its operations to a location outside of the state, all or a portion of the financial assistance received is subject to disallowance, recapture, or immediate repayment.
Limitations
An eligible business shall not receive more than one award of financial assistance.
An eligible business that receives financial assistance may subsequently apply for financial assistance under other programs administered by the department of economic development.
An eligible business that receives financial assistance shall not use such financial assistance for purposes of meeting payroll obligations to employees.
Appropriation................... $ 5,000,000
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