Posted by Dan Sexton, Ashley Altizer and Jack Shaughnessy
Grants and government backed loans can provide companies with critical alternatives to traditional financing, as well as opportunities to partner with their lenders in capital projects. As federal and state governments look to spur economic development and create jobs, there are numerous funding opportunities available to qualified small and medium sized businesses across a variety of industries.
Specifically, certain federal and state initiatives support companies looking to invest in advancing their manufacturing processes and efficiencies through technology and innovation. Below are five such funding opportunities Michigan manufacturing companies in particular may want to consider in the new year.
1. Department of Environment, Great Lakes, and Energy: Small Manufacturers Retooling
Type
Purpose
- To further energy efficiency of Michigan manufacturers
Award Amount
- Up to $50,000
- Applicants must match 100% of the funds they receive.
Eligibility Highlights
- Company must have fewer than 500 total employees
- Grant must be used to further/innovate manufacturing processes
- Improvements must result in significant economic or environmental benefit
Application Deadline
2. Michigan Economic Development Corporation: Industry 4.0 Technology Implementation Grant
Type
Purpose
- To help small businesses implement modernized technologies in Michigan
Award Amount
- Up to $25,000
- Funding will be received in the form of a reimbursement of up to 50% of project expenses
Eligibility Highlights
- Must be a manufacturing company AND a small business as defined by the U.S. Small Business Administration
- Plant/factory must be in Michigan
- Must complete a I4.0 Technology Assessment
- Must be a member or essential member of the Automation Alley (free to participate)
- Must be making investments in certain areas of innovation and technology, including additive manufacturing (3D printing), automation, robotics and AI, among others
Application Deadline
3. Department of Labor & Economic Opportunity: Michigan Business Development Program
Type
Purpose
- To create jobs in Michigan
Award Amount
- Up to $10 million in grants, loans and other economic assistance
Eligibility Highlights
- Must commit to creating 50-plus jobs in Michigan or 25-plus if your company operates in:
- One of approximately 30 “innovation industries,” including automotive, automation, engineering, machinery, etc., or
- A rural Michigan location.
- Must be located in a geographically disadvantaged area in which unemployment is greater than the state of Michigan’s average (4.1% through October 2023)
- Eligible projects must demonstrate potential to grow economic development in Michigan
Application Deadline
4. Department of Environment, Great Lakes and Energy; Small Business P2 Loans
Type
Purpose
- To improve environmental conditions and considerations at small businesses
Funding Amount
- Up to $400,000 loan at a maximum 5% interest rate
Eligibility Highlights
- Business must have 500 employees or less
- Must have qualifying expenses relating to process modification, raw material substitution or equipment modifications, among others
Application Deadline
5. U.S. Department of Agriculture: Rural Energy for America Program Renewable Energy Systems & Energy Efficiency Improvement
Type
- Federal grant or guaranteed loan
Purpose
- To support small businesses in rural America
Award Amount
- Funding ranging from $2,500 - $1 million
Eligibility Highlights
- Located in a rural area (50,000 residents or less)
- Must qualify as a small business
- Must have qualifying expenses relating improvements in energy efficiency, examples include: lighting, insulation, replacement of energy inefficient equipment, etc.
Application Deadlines
Tips for Applying
In addition to applying on time and supplying all requested information upfront, there are a couple of proactive steps you can take that will make you a better candidate for the funding and better prepared to put it to good use:
- Maintain accurate and reliable financial statements. Grantors must be able to rely on the success of your project. One of the best ways to display financial readiness is by showing a history of sound financial reporting.
- Create a budget and detailed plan. Planning and budgeting is crucial when applying for a grant, specifically for grants containing a matching requirement. Ensuring you have a deep understanding of costs and expectations will be critical to help avoid any gaps in project funding.
Michigan manufacturers have significant opportunities to capitalize on federal and state funding to support growth and expansion for their innovative capital projects. Don’t leave money on the table. Work with your tax and business advisers to take advantage of any and all funding sources that could potentially further your project’s goals.
Contact Dan Sexton, Ashley Altizer, Jack Shaughnessy or a member of your service team to discuss this topic further.
Cohen & Co is not rendering legal, accounting or other professional advice. Information contained in this post is considered accurate as of the date of publishing. Any action taken based on information in this blog should be taken only after a detailed review of the specific facts, circumstances and current law.