Program Sows Seeds for Statewide Employment

(Columbus)--Ohio Treasurer Richard Cordray today met with members of the National Federation of Independent Business/Ohio (NFIB) Area Action Council in Cincinnati.

The NFIB/Ohio, the statewide office for the nation’s leading advocacy association for small businesses and entrepreneurs, is teaming up with Cordray to spread the word about the Treasury’s interest-rate reduction program, which is being relaunched and re-tooled under the new name, “GrowNOW.”

“The birth and health of small businesses are vital to Ohio’s economy,” Cordray said. “NFIB members are on the front line of job creation and retention in our state. We hope to harness their insight and learn how the Treasury can do more to provide the support entrepreneurs need to survive and create new jobs.”

In 2006, the latest year for which statistics are available, Ohio was home to 920,500 small businesses. Currently, 49.6 percent of privately-employed Ohioans work for small businesses. Over the last decade, 60 to 80 percent of new jobs annually have been created by small businesses.

“The unemployment rate in Ohio is 6.0 percent, while nationally it is 5.0. Our median household income lags the national median by over $2,000. It is clear that we need the kind of high quality jobs that small businesses can create. It is time for Ohioans to come together and put all hands on deck to reverse the course of Ohio’s economy by using this important tool: small business.”

Recognizing the need for small business growth in Ohio, the Treasury has worked over the past year to revamp the Small Business Linked Deposit Program for today’s economy. The program, established in 1983 by Ohio Treasurer Mary Ellen Withrow, provides interest-rate reductions to eligible small businesses. After a bank approves a loan to a small business, the small business can apply for a linked deposit from the Treasury. The business must show that the loan is helping them to create or retain jobs and, if approved, the Treasury will invest in a CD from the bank and accept a reduced-interest rate, provided the bank passes that reduction along to the small business.

This month, the Treasury will rename the 25-year-old interest rate reduction program to GrowNOW in order to increase the program’s user friendliness and better represent the program’s ease of use in order to attract more applicants. But, more than the name has been changed:

• The maximum loan amount was increased from $250,000 to $400,000;
• The jobs-to-dollars ratio was doubled from $25,000 to $50,000 per job to reflect the need for sustained higher wages for good jobs;
• The application process will unfold online for the first time at grownow.ohio.gov. The Web-based application will allow the Treasurer’s office to approve applicants in just 48 hours, to provide Ohio’s small businesses with the timely resources they need.

These changes will allow businesses in higher paying industries to take advantage of the program savings, and the higher loan amount will allow entrepreneurs to undertake even greater growth.

Eligible small businesses must be organized for profit with fewer than 150 employees. The business must be headquartered in Ohio. Applications are available now at www.grownow.ohio.gov.