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Ohio Loan Programs to Boost Minority-Owned Businesses

Ohio has created two new loan programs to enhance growth of minority and women owned businesses in Ohio. The Ohio 2022-2023 operating budget includes the Women’s Business Enterprise Loan Program and Ohio Micro-Loan Program. 

The Women’s Business Enterprise (WBE) loan Program will offer loans at or below market rate interest (currently are up to 3%). The minimum loan amount is $45,000 up to a maximum of $500,000. Loans will be repaid within 10 years for equipment and machinery and 15 years for owner-occupied real estate. 

To become certified as a WBE, a business must be owned and controlled by a woman who is a U.S. citizen and has an established residency in the state of Ohio or a reciprocal state. Additionally, a business must have been in business for at least one year prior to applying for a loan and must be at least 51% woman-owned. The business owner must (a) possess requisite knowledge of the business and industry in which she is applying; (b) have day-to-day control over the business, exercising final authority over all aspects of daily operations; and (c) possess all licenses and permits required by law to perform the scope of work within classifications requested. 

If a business meets the requirements to become a WBE, then the business can complete an application and provide supporting documentation to be submitted to the Ohio Department of Administrative Services, Equal Opportunity Division (@ das-eod.bccu@das.ohio.gov.). It should be noted that applications are subject to an interview and possible onsite review by state compliance officers. Reviews take an average of 60 to 90 business days from the time a completed application is submitted. There will be a $300 application fee and a commitment fee of 1.5% of the loan amount. Keep in mind that expediated applications are available if the applicant (a) submits an expediated application and (b) provide a valid certificate with an approved program issued by a reciprocal state or partnering agency. Upon application approval, the company receives its WBE-certification by email. 

The other new loan program is the Ohio-Micro Loan Program. This loan program was created to stimulate the growth of new and existing businesses by providing micro-loans at 0% interest. The minimum loan amount is $10,000 to a maximum of $45,000. Loans will be repaid within 5 years for permanent working capital and 7 years for equipment. To qualify for this loan, businesses must be certified as a WBE or Minority Business Enterprise (MBE). 

In order to become qualified as an MBE, the business must be owned and controlled by a U.S. citizen who is a resident of Ohio and a member of one or more of these minority groups: Blacks or African Americans, American Indians, Hispanics or Latinos, and Asians. In addition to that requirement, a business must: 

  • have been in business for at least one year prior to applying; and
  • be at least 51% minority-owned 

Furthermore, the business owner must:

  • possess requisite knowledge of the business and industry in which he or she is applying;
  • must have day-to-day control over the business, exercising final authority over all aspects of daily operations (operations, financial and business management, human resources and policy decisions);
  • must demonstrate capability or expertise within the classifications identified for a period of one year prior to certification; and
  • possess all licenses and permits required by law to perform the scope of work within classifications requested 

If a business meets the requirements to become an MBE, then the business can complete a Unified Application through the Ohio Business Gateway and provide supporting documentation. Like the WBE process, applicants are subject to on-site review by state compliance officers. Reviews take an average of 60 business days or less from the time a completed application is submitted. Upon application approval, the company receives its MBE-certification by email. 

These two new loan programs will be administered by the Ohio Department of Development through the Minority Business Development Division. The Women’s Business Enterprise Loan Program and Ohio Micro-Loan Program are additions to the Ohio Minority Business Bonding Program, the Ohio Minority Business Direct Loan Program, the Collateral Enhancement Program, and the Ohio Capital Access Program.           

Ohio has shown a significant interest in working with minority businesses to help them achieve scale and market success. Your business could be positively impacted by qualifying and receiving loans allocated to minority businesses. If you have a minority business and need guidance applying for loans, please contact BMD Corporate and Mergers and Acquisitions Attorney Bakita E. Hill, Esq. at behill@bmdllc.com.

Explosive Growth in Pot of Gold Opportunity for Bank (and Other) Cannabis Lenders Driving Erosion of the Barriers

Our original article on bank lending to the cannabis industry anticipated that the convergence of interest between banks and the cannabis industry would draw more and larger banks to the industry. Banks were awash in liquidity with limited deployment options, while bankable cannabis businesses had rapidly growing needs for more and lower cost credit. Since then, the pot of gold opportunity for banks to lend into the cannabis industry has grown exponentially due to a combination of market constraints on equity causing a dramatic shift to debt and the ever-increasing capital needs of one of the country’s fastest growing industries. At the same time, hurdles to entry of new banks are being systematically cleared as the yellow brick road to the cannabis industry’s access to the financial markets is being paved, brick by brick, by the progressively increasing number and size of banks that are now entering the market.

2021 EEOC Charge Statistics: Retaliation & Impact of Remote Work

The U.S. Equal Employment Opportunity Commission (EEOC) released its detailed information on workplace discrimination charges it received in 2021. Unsurprisingly, for the second year in a row, the total number of charges decreased as COVID-19 either shut down workplaces or disconnected employees from each other. In 2021, the agency received a total of approximately 61,000 workplace discrimination charges - the fewest in 25 years by a wide margin. For reference, the agency received over 67,000 charges in 2020, and averaged almost 90,000 charges per year over the previous 10 years.

Ohio’s Managed Care Overhaul Delayed – New Implementation Timeline

At the direction of Governor Mike DeWine, the Ohio Department of Medicaid (ODM) launched the Medicaid Managed Care Procurement process in 2019. ODM’s stated vision for the procurement was to focus on people and not just the business of managed care. This is the first structural change to Ohio’s managed care system since the Centers for Medicare & Medicaid Services' (CMS) approval of Ohio’s Medicaid program in 2005. Initially, all of the new managed care programs were supposed to be implemented starting on July 1, 2022. However, ODM Director Maureen Corcoran recently confirmed that this date will be pushed back for several managed care-related programs.

Laboratory Specimen Collection Arrangements with Contract Hospitals - OIG Advisory Opinion 22-09

On April 28, 2022, the Department of Health and Human Services, Office of Inspector General (“OIG”) published an Advisory Opinion[1] in which it evaluated a proposed arrangement where a network of clinical laboratories (the “Requestor”) would compensate hospitals (each a “Contract Hospital”) for specimen collection, processing, and handling services (“Collection Services”) for laboratory tests furnished by the Requestor (the “Proposed Arrangement”). The OIG concluded that the Proposed Arrangement would generate prohibited remuneration under the federal Anti-Kickback Statute (“AKS”) if the requisite intent were present. This is due to both the possibility that the proposed per-patient-encounter fee would be used to induce or reward referrals to Requestor and the associated risk of improperly steering patients to Requestor.

Property Owner Protection from Tax Valuation Challenges

New legislation provides significant new protections for commercial property owners against challenges to valuation primarily by local school boards and prohibiting side agreements to avoid tax valuation changes. The Ohio Legislature has approved House Bill 126 which will go into effect July 2022 but will effectively apply to the 2023 tax valuation year.