Community Development Block Grant- Economic Development (CDBG-ED)
Small businesses looking for start-up funds or for money to expand may be eligible for financing through a Community Development Block Grant for Economic Development (CDBG-ED). This program funds your community’s Revolving Loan Fund to keep loan money in your community to benefit growing businesses. To learn more about how this program works, just click on the questions below:
How does the CDBG-ED work?
The CDBG-ED program funds community revolving loan funds. When an eligible business applicant applies for a revolving loan fund and the community does not have enough funds available locally, the community applies for a CDBG-ED. If the grant is awarded to the community, the community then lends the grant funds out to the applicant business. As the business repays the loan to the local revolving loan fund, the principal and interest repayments are kept within the Revolving Loan Fund and are made available to other future applicant businesses applying for RLF funds. (back to top)
Where does the funding for a CDBG-ED come from?
The funding comes from the Ohio Department of Development Office of Housing and Community Partnerships. Communities apply for these grants when they do not have enough RLF funds available to loan for an eligible project. (back to top)
Is my community eligible?
Eligible communities must be non-entitlement cities or counties. Counties may apply on behalf of cities within their jurisdiction but must apply on behalf of villages and/or townships. (back to top)
What are the requirements for receiving a CDBG-ED?
The applicant business must commit to creating one full-time job for every $25,000 awarded. In addition, at least 51% of the full-time jobs created must be available to persons from low-to-moderate income households. (back to top)
What kind of projects can be financed using funds from a CDBG-ED?
Funds from a CDBG-ED must be used for fixed-asset projects, such as land or building acquisition; new construction, renovation, or expansion of existing facilities; demolition or site preparation; or acquisition of new or used machinery and equipment. (back to top)
How are grants awarded?
Community Development Block Grants are awarded to community applicants on a competitive basis based on the applicant business’ project. Various factors are taken into consideration, including equity contribution, total project costs and job creation commitment. (back to top)
What is the maximum grant?
The maximum grant is $500,000 to the community per applicant business project. (back to top)
What are the terms of a CDBG-ED?
The CDBG-ED is a grant to the applicant community. As a result, there are no repayment terms on the grant when it is awarded. The applicant community is then responsible for determining the rate and term of the loan, and for assuring the applicant business meets those conditions. The terms are a maximum 10 years for machinery and equipment acquisition, and 15 years for real estate projects. (back to top)
Are there any costs?
Yes. The applicant business is responsible for all application, environmental, legal, and other fees and costs. (back to top)
How long is the approval process?
The CDBG-ED grant applications are reviewed and approved by the Ohio Department of Development Office of Housing and Community Partnerships. Typical approval takes 45 days. The application process does require an environmental review, which can take between 60 and 90 days for real estate and 5 days for equipment. (back to top)