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The Small Business Pollution Prevention (P2) Loan Program allows small, Michigan businesses to apply for P2 loans of up to $400,000 at an interest rate of 5% or less. P2 loans are available through a lender of the business' choice. Your lender participates in the loan with the Department of Environment, Great Lakes, and Energy (EGLE) by providing half of the financing.
Loans are available to all private business sectors, including manufacturing, farming, retail and service. However, a small business can not receive more than 1 loan in any 3 year period.
Are you eligible to apply?
If your business is...
- independently owned and operated;
- not dominant in its field;
- a small business concern (organized for profit); and
- 500 full-time employees or less
...you meet the small business requirements of the loan program and may be eligible for a low interest loan.
What types of projects meet the P2 criteria?
P2 project recommendations from a Retired Engineer Technical Assistance Program (RETAP) audit or qualifying P2 expenditures, including on-site:
- equipment or technology modifications;
- process or procedure modifications;
- raw material substitution;
- housekeeping, maintenance, inventory control improvements;
- specific types of employee training;
- on-site energy conservation projects;
- on-site water conservation projects; or
- other P2 projects.
Ineligible projects or expenditures include prior incurred costs, refinancing, labor or operating costs, taxes, fees and land acquisitions, and projects whose primary purpose would be to increase production.
How do you apply?
- Select a P2 project for your small business.
- Prior to applying for a loan, EGLE staff is available to assist you in identifying eligible projects or discussing the application process. For this optional pre-loan service, contact Chad Rogers, Small Business P2 Loan program manager, at 517-284-6872 or 800-662-9278.
- Get a written price quote from your contractor and estimate the project schedule.
- Obtain an application from EGLE.
- Work with your lender.
- Talk to your lender about your loan and credit worthiness. Your lender can be an in- or out-of state bank, thrift or credit union (but not a leasing company).
- Fill out an application, available through EGLE.
- Either you or your lender can send your application to EGLE for a project eligibility determination.
- Your lender will evaluate your credit worthiness and ability to repay debt as well as establish the terms and conditions of the loan.
- After your project is approved by EGLE.
- Submit a draft Supplemental Agreement to EGLE.
- Submit a draft Lender Agreement to EGLE.
- Submit your lender's draft Loan Agreement or Promissory Note, outlining the terms of the loan, to EGLE. Note: this document needs to cross-reference the above mentioned Supplemental Agreement.
- Submit a Loan Amortization Schedule to EGLE.
- Draft loan documents are reviewed by EGLE prior to closing, with you and your lender getting notified if changes are required.
- Once loan documents are finalized, your lender will hold a closing.
- Your lender will send executed loan documents to EGLE.
- Upon receipt of the executed Loan Agreement or Promissory Note, EGLE will execute the Lender and Supplemental Agreements and approve disbursement of its loan portion to your lender.
- Ninety days after project completion, you are required to submit a summary of actual P2 results to EGLE.
All these steps are also outlined in the Program Brochure for Small Businesses.