New economic assistance for small businesses, early stage tech companies and communities around Michigan negatively impacted by the COVID-19 virus gained approval from the Michigan Strategic Fund, the Michigan Economic Development Corporation announced today.
“We are committed to leveraging every resource available to us as effectively as we can to support small businesses, entrepreneurs, communities and workers across the state being negatively affected by this unprecedented outbreak,” said MEDC CEO Mark A. Burton. “The initiatives approved today by the Michigan Strategic Fund will provide much-needed resources for small businesses and early stage tech companies facing challenges with cash flow and communities working to support and protect their residents.”
The Northern Initiatives program will provide up to $2 million in loan funds to Northern Initiatives through MEDC’s Capital Access program to be used to assist businesses impacted by the COVID-19 virus. Northern Initiatives, a Community Development Finance Institution regulated by the U.S. Department of Treasury, provides business loans to existing and start-up businesses, primarily in underserved rural markets. Northern Initiatives will use the funds to make micro and small business loans ranging from $5,000 to $250,000 to Michigan’s small businesses in the 73 counties it serves, with an emphasis on women- and minority-owned businesses. The program is aimed at assisting those businesses that have been most impacted by the COVID-19 virus, such as restaurants, coffee houses, retail stores, and service providers. Businesses can use these loans primarily for working capital, acquiring machinery and equipment, and inventory.
“The Northern Initiatives program is yet another step we are taking to ensure that businesses impacted by COVID-19 – especially those in geographically disadvantaged areas – receive the support and relief they need to come out on the other side of this crisis successfully,” Burton said.
Businesses interested in applying for a loan should visit https://northerninitiatives.org/apply-for-a-michigan-small-business-loan/.
The MSF Awardee Relief Initiative program approved today authorizes emergency relief to businesses and community projects that have previously received grants, loans, or other forms of economic assistance from the Michigan Strategic Fund. The program would temporarily allow measures such as extended milestone due dates for up to a year, providing up to a year of deferred payments on financing agreements with MSF, and eliminating or reducing job creation requirements with a proportional reduction of the grant award to re-size the project scope.
This program would be available to support any MSF program awardee that is negatively financially impacted by the COVID-19 crisis. Applicants will be evaluated with relief prioritized based on suspension of tenant evictions, income loss, credit enhancement needs or restrictions, retooling of facilities to meet emergency needs, job creation issues, job retention issues, or other community needs or project delays due to COVID-19. Projects must also suspend owner distributions during the period of relief other than those that cover payroll and taxes. The length of relief will be determined based on the needs of the individual project.
The MSF board also authorized approval of awards on a delegated basis, rather than require the vote of the full board, in order to ensure immediate approval to projects during the crisis. The program will be temporary, with plans to sunset after one year and will not involve disbursement of any additional funds to any awardee.
For more information on the MSF Awardee Relief Initiative, visit https://www.michiganbusiness.org/about-medc/covid19/msf-awardee-relief-initiative/.
The board also approved $3 million in Pre-Seed III funds to be administered by Michigan State University Foundation to better support entrepreneurs and tech startups across Michigan over a one-year period. This funding will support the MSU Foundation in engaging with pre-seed stage companies by providing capital support, coaching, assistance with grant funding and more. The award of this Pre-Seed Fund is especially critical right now, considering the impact that COVID-19 continues to have on Michigan’s early-stage tech companies. The fund will be vital in providing the best support possible to early-stage technology companies to help put them on a path to survive the economic crisis and scale accordingly when the outbreak subsides.
Today’s initiatives are just the latest efforts of MEDC and the state’s small business support organizations to assist small businesses, startups, entrepreneurs and communities throughout the state in the face of the COVID-19 virus. Other resources for businesses across Michigan to assist them in recovering from economic losses as a result of the COVID-19 virus can be found online at michiganbusiness.org/covid19. This site includes resources offered by the U.S. Small Business Administration including emergency loans, the Pure Michigan Business Connect virtual procurement and donation platform, support services offered through the Small Business Development Center and more. The MEDC has also developed a FAQ for Michigan businesses and communities at michiganbusiness.org/covid19-faq.
The Michigan Strategic Fund also took the following actions today:
The Grand Traverse County Brownfield Redevelopment Authority received MSF approval of a Brownfield Act 381 Work Plan including state tax capture of $3,863,094 to support a community development project in the Eighth Street Corridor in Traverse City. The Eighth and Boardman Redevelopment Project will demolish an existing single-story office building on Eighth Street that will make way for a new, three-story commercial building, creating an attractive new development that will offer an urban walkable design and support the local efforts to provide pedestrian and bicycle access to the site and the riverfront. It also includes low-impact design storm water management systems and a waterfront boardwalk. The project is anticipated to result in a total capital investment of $10.4 million, and create 15 new, full-time equivalent jobs and retain 25 full-time jobs. The tax capture will be used to alleviate brownfield eligible conditions at the site.
The project is consistent with the MEDC Strategic Plan by reactivating an underutilized property in a commercial corridor, bringing new taxable value to the area and adding high-paying jobs to the market. The city of Traverse City is providing $4,278,306 in local tax capture to alleviate brownfield conditions and prepare the site for redevelopment. Traverse City is certified with MEDC’s Redevelopment Ready Communities program.
The Washtenaw County Brownfield Redevelopment Authority received MSF approval of a Brownfield Act 381 Work Plan including state tax capture of $2,480,000 for the Broadway Park community development project in the city of Ann Arbor. The project will transform a 13-acre, vacant riverfront site into a mixed-use redevelopment that will include residential, commercial and hospitality near Ann Arbor’s vibrant urban core. Broadway Park will include 104 condominium units, a nine-story hotel, a destination restaurant and commercial retail space. The project will also make public infrastructure improvements and will create an outdoor public park that will include an all-season pavilion, a water feature, a hike-and-bike trail and a paddle craft launch area. The project is expected to generate a total capital investment of $100 million and create 100 permanent, full-time equivalent jobs. The tax capture will be used to reimburse the developer for brownfield eligible activities.
The project is consistent with the MEDC Strategic Plan by transforming an underutilized, highly contaminated site into a vibrant area and bringing much-needed housing to the community. In addition, eight of the 13 acres will be activated into public green space. The city of Ann Arbor is providing $5.5 million in local tax capture to alleviate brownfield conditions and prepare the site for redevelopment. The city of Ann Arbor is engaged with MEDC’s Redevelopment Ready Communities program. In addition, the project is requesting approximately $9.3 million in tax increment financing from the Michigan Department of Environment, Great Lakes and Energy to assist with significant environmental eligible activities.
About Michigan Economic Development Corporation (MEDC)
The Michigan Economic Development Corporation is the state’s marketing arm and lead advocate for business development, job awareness and community development with the focus on growing Michigan’s economy. For more information on the MEDC and our initiatives, visit www.MichiganBusiness.org. For Pure Michigan® tourism information, your trip begins at www.michigan.org. Join the conversation on: Facebook, Instagram, LinkedIn, and Twitter.