Ohio Minority Business Bonding Program

Ohio Development Services Agency

Program Type:

Loan; Loan Guarantee

Eligible Geography:

Ohio

Program URL:

http://www.development.ohio.gov/bs/bs_ombbp.htm

Summary:

The Minority Business Bonding Program provides bid, performance, and payment surety bonds to state certified minority-owned businesses that are unable to obtain bonding through standard surety companies. To produce long term positive results by assisting minority businesses in eventually obtaining bonding from the private sector; and to provide minority businesses with the best opportunity for long-term success and stability, while concurrently reducing the State of Ohio's exposure to losses. The maximum bonding line pre-qualification is $1 million per business. The premium for each bond requested is 2 percent of the face value of the bond. The business must demonstrate the benefit to Ohio residents by increasing employment opportunities. The collateral and/or security are the personal guarantees of the principals and persons substantially involved in business operations, and other such collateral as warranted.

The applicant shall pay a premium (in advance) for each bond to be issued by the Director. This is not to exceed two percent of the penal sum of the bond. The premium may be adjusted upward or downward if the contract amount is changed by more than the less of 5% or $10,000.00.

Eligible Recipients:

For-Profit Business

Eligible Recipients Detail:

All applicants must meet the following criteria: Be defined as a "Minority Business" as set forth in Section 122.71(E) (1) of the Ohio Revised Code. Be certified by the Equal Opportunity Division of the Department of Administrative Services as a minority business enterprise (MBE). Applicant must not have defaulted on a previous bond issued by the Director and no general or limited partner or shareholder in the minority business enterprise may have defaulted on a previous bond issued by the Director.

Eligible Purpose:

Last Mile Infrastructure; Building Infrastructure; Broadband Enabled Devices

Eligible Purpose Detail:

The business must demonstrate the benefit to Ohio residents by increasing employment opportunities through use of the bond. All projects must meet the following criteria: Be economically sound, Benefit the people of the state by increasing opportunity for employment, and Expand the minority business enterprise.

Other Eligibility Criteria:

The applicant must meet the following criteria: Demonstrate adequate insurance coverage on its business operation and key employees. Have a line of credit equal to or greater than 20 percent of the bonded amount or; Demonstrate sufficient financial resources to justify a lesser credit facility.

Once accepted into the program, businesses will be required to provide quarterly financial statements prepared by an independent certified public accountant, a license public accountant or a preparer acceptable to the Director to maintain their eligibility. The Director will require removal of state tax liens.

Funding Match/Terms:

The maximum bonding line pre-qualification is $1 million per business. The premium for each bond requested is 2 percent of the face value of the bond.