Category Archives: Corporate Transactional

The State of Ohio has added two programs to further assist small businesses with the unprecedented business interruption associated with the COVID-19 pandemic crisis, (a) $125 million in Small Business Relief Grants and (b) $1.5 billion in refunds to small businesses from the Workers Compensation program. Details on both programs are below

1. Small Business Relief Grant.

   The Small Business Relief Grant (“SBRG”) is designed to provide necessary relief to Ohio businesses that have been negatively impacted by the effects of COVID-19. The State has designated up to one hundred twenty-five  million dollars ($125,000,000) of funding received by the State of Ohio from the Federal CARES Act to provide $10,000 grants to small businesses to assist in ensuring the survival and stability of these crucial businesses.

   Some of the terms  are:

   • The applicant business is a for-profit entity (corporation, LLC, partnership, joint venture, sole proprietor).
   • The applicant business is an employer firm with at least 1 and no more than 25 Ohio employees paid via W2 wages as of 1/1/2020, determined either by a headcount or full-time equivalent employee calculation.
     • NOTE: A headcount calculation should include both part-time and full-time employees. A full-time equivalent calculation equals the total hours compensated for all W2 employees in calendar year 2019 divided by 2,080.
   • The applicant business has a physical location in Ohio and earns at least 90% of annual revenue from activities based in Ohio.
   • The applicant business has been in continuous operation since January 1, 2020, except for interruptions required by COVID-19 public health orders, and has the ability to continue operations as a going concern, taking into account a potential program grant.
   • The applicant business has experienced revenue loss or incurred unplanned costs substantially caused by COVID-19 and a grant is necessary to help it recover from the impact of COVID-19.
   • The applicant business is in good standing with the Ohio Secretary of State, the Ohio Department of Taxation, and any other governmental entity charged with regulating the business.
   • If applicable, the applicant business has fully utilized any other government support received (including both grants and loans) by the applicant business for business expenses incurred due to COVID-19 or that can be utilized for business expenses incurred due to COVID-19.
   • The link for the Ohio Small Business Relief Grant program from the Ohio Development Services Agency is here.

   There are also restrictions that may nullify your ability to obtain a grant.  Contact Jane Schulte at Finney Law Firm for more information on how we can assist you in navigating the application process.

2. Workers Compensation refunds.

• • This is the second refund program this year, this time distributing $1.5 billion in excess funds held by the Ohio Worker’s Compensation program to Ohio employers. BWC started sending checks to up to 200,000 private and public employers in its system in late October after first applying the dividend to any unpaid balances. The dividend follows a similar dividend in April, where the average check size was $8,500.
  • The refunds are automatically calculated and the checks sent by the BWC. No action on the part of employers is necessary.
  • The announcement from the BWC is here.

You will soon hear the terms SBA 7(a) program and “Payroll Protection Program” as an important and significant program to help virtually every small business in the nation.

While labeled as a “loan program,” it in fact can operate as a generous grant program for any business or non-profit under 500 employees. The “loan” is 2.5 times your monthly payroll expenses. More details are available in this article from National Law Review.

Here are the key features:

• You apply for a “loan” through an SBA-approved lender. Here is the SBA link to Cincinnati-Area approved lenders.  The Cincinnati-area list is very short: US Bank, Fifth Third Bank, The Huntington National Bank, First Financial Bank, PNC Bank, Center Bank and People’s Bank from Marietta.
• The “loan” is in an amount that is 2.5 times your monthly business’ payroll, being the monthly average over the 12 months prior to the date the loan is made.
• The “loan” is in a maximum amount of no more than $10 million.
• The “loan” has no fees associated with it.
• The “loan” requires no personal guarantees.
• The “loan” requires no collateral.
• The “loan” does not require proof that funds cannot be received elsewhere.
• The “loan” has a simplified application process.
• The “loan” will be funded quickly to avoid the economic impact of the COVID-19 crisis.
• Most importantly, borrowers are eligible for loan forgiveness equivalent to the sum spent on covered expenses during the eight-week period after the loan is originated. 
• Covered expenses include wages, benefits, rent, mortgage payments, and utility charges.
• The “loan” is forgiven if you maintain your pre-crisis level of full-time equivalent employees for eight weeks after the loan is made.
• If you fall below that level of employment, your loan forgiveness is reduced in proportion to the reduction in headcount. The same applies to salary reductions.
• If you already have made staffing reductions, you qualify for loan forgiveness if you re-hire back to pre-crisis levels by June 30, 2020.
• You do not need to demonstrate actual economic harm in order to qualify. Rather, you simply need to make a series of good faith certifications, primarily that (a) current economic conditions necessitate the loan to support ongoing business operations, and (b) that the funds will be used to maintain payroll and address other covered expenses.

In order to apply, you need to contact an SBA-approved lender Qualified SBA lenders are awaiting further instruction from the SBA.  Contact your lender to get on their email list to obtain application instructions as they become available.  We will update this BLOG as new information is forthcoming.

Here is an excellent article explaining the Payroll Protection Program from Inc. Magazine.

You may contact attorney Christopher Finney (513.943.6655 (o) or 513.720.2996 (c)) at any time for more information.