Background The Diverse Business Assistance Grant Program is administered by the Wisconsin Department of Administration (DOA). The purpose of the program is to provide funding to assist chambers and non-profit organizations providing assistance to businesses owned by individuals from diverse communities. These communities have been denied access to capital in the past or are underbanked, and have been disproportionately impacted by the Covid-19 pandemic. The program is supported by American Rescue Plan Act of 2021 (ARPA) Federal funding.
Ashland Area Development Corporation (AADC) submitted a grant application to the DOA, and was selected to receive a Diverse Business Assistance grant award. AADC’s application proposed to deliver entrepreneurial instruction, individualized consulting, a mentoring network, access to capital (grants), and guidance in forming professional networks. The intended diverse businesses to be assisted by AADC’s entrepreneur program include those owned by Ashland County entrepreneurs who are Native American, people of color, women, and/or LGBTQ+. AADC has named this program “FUNDiversity”.
Timeline This grant will end on December 31, 2024. All expenses must be incurred prior to that date.
Eligibility Requirements 1. Program participants may be a current business owner or aspire to be a future business owner. Entrepreneurial experience is not required to participate. 2. The diverse community businesses to be served are those which are 51% owned, controlled, and actively managed by a woman, a member of a qualifying minority, or a person who identifies as a member of the LGBTQ+ community. Program participants will be required to sign an affidavit and provide articles of incorporation or other documentation proving ownership of business. 3. At least one of the business owner(s) who meet the 51% threshold must also have resided in Ashland County for at least 90 days prior to the disbursement of the down payment grant award. 4. Businesses must currently be located, or will be located, in Ashland County. 5. Individuals applying for capital must be at least 18 years old. 6. Nonprofit organizations and government entities are not eligible to participate in this program.
Program Components Interested residents of Ashland County may register for the grant program by calling Ashland Area Development Corporation at 715-682-8344 to schedule an appointment for a simple interview with a staff member. Eligible program participants will then meet with a staff member to determine the entrepreneur’s business goals and what types of support services are needed. Together, the staff member and the program participant will develop an action plan which will be supported by one or more of the following three primary service components: 1. Entrepreneur training classes and/or one-on-one coaching 2. Mentorship from local, experienced, business owners 3. Capital to be used as a down payment to improve eligibility for a business loan from a commercial lender (such as a bank or credit union), or business loans from regional economic development agencies (such as Ashland Area Development Corporation and Northwest Regional Planning Commission)
Entrepreneur Training Classes and One-on-One Coaching The goal of the classes is to teach entrepreneurs how to develop a strong, effective business plan. Classes will be held at the Ashland Area Enterprise Center located at 422 3rd St. West in Ashland. Instruction will be available to entrepreneurs regardless of their level of business experience. Topics will include business legal structure, small business bookkeeping, budgeting, pricing, marketing, and planning for retirement. Program participants will be encouraged to participate in one-on-one coaching sessions with trained staff and other qualified, approved professionals. This will provide opportunity for program participants to receive feedback on their business plan drafts throughout the process of developing the plans. Additionally, program participants who need to confer with a professional for legal or accounting advice will receive services paid for by the program. Mentorship Mentorship from successful business owners, especially those familiar with local diverse communities, will help support the development of new entrepreneurs. Mentors will share their skills, knowledge, and enthusiasm with program participants. AADC has developed a list of local business owners who have agreed to participate as mentors.
Funding for Program Participants Program participants may apply for grant funds to use as down payments for loans when purchasing property or equipment needed for their business. The down payment will be in the form of a grant and will not need to be repaid. A program participant who wishes to apply for a down payment grant will submit application materials to AADC staff. AADC staff will present applications to AADC’s Review Committee, which will be responsible for reviewing the application and recommending approval to AADC’s Board of Directors. AADC’s Board of Directors will be responsible for the final approval of applications. To be considered for a down payment grant, applicants must submit the following materials to AADC staff: An application form A complete and fully-developed business plan Articles of incorporation or other proof of existence Evidence that a business loan application has been submitted to a qualified lender Other materials as requested to support the applicant’s funding request Questions? Please refer to the Frequently Asked Questions (FAQs) below or contact AADC at 715-682-8344.
Frequently Asked Questions (FAQs)
1. What does this program offer? Business training, coaching, and funding for entrepreneurs from socially and economically disadvantaged communities in Ashland County, Wisconsin. Specifically, the key components offered will include classroom instruction and individual coaching, mentorship from volunteers who are successful business owners, and down payment grants for entrepreneurs who will be seeking business loans from certified lenders, such as banks.
2. Who is administering this program? Ashland Area Development Corporation (AADC) developed and will be administering this program in Ashland County. AADC received a grant to implement the Entrepreneur Assistance Program from Wisconsin’s Department of Administration (DOA) through the DOA’s Diverse Business Assistance Program.
3. Who is eligible to participate in this program? Individuals from historically underrepresented communities (i.e., historically have been denied access to capital or who have historically been underbanked) in Ashland County. This program will serve entrepreneurs from the following ethnic and diverse business communities: Native American, women, people of color, and LGBTQ+.
4. Does a business need to be owned at least 51% by a member of an underrepresented community, or is 50% enough? The business must be at least 51% owned, controlled, and actively managed by a member of a qualifying minority community, or 51% owned, controlled, and actively managed by a woman.
5. Can a group of people who own a business apply if at least one of them is a member of an underserved community? At least 51% of the total ownership must meet the eligibility requirements.
6. Does the business owner need to be a resident of Ashland County? If so, is there a minimum residency requirement? The applicant’s primary residence must have been located in Ashland County for the last 90 days prior to disbursement of the down payment grant award.
7. Does the business need to be located in Ashland County? Yes
8. Are nonprofit organizations, tribal enterprises, local governments, franchises, and online businesses eligible to apply? No
9. Are businesses that are part of a franchise eligible to apply? Yes, if the business that is applying is located in Ashland County, and the business owner(s) resides in Ashland County and meets all eligibility requirements. Franchises, however, are not eligible for this program.
10. What is the cost for participants? Participation is free.
11. What’s the difference between a grant and a loan? A loans need to be paid back; a grant does not.
12. What things can this program’s down payment grant be used for? A down payment grant award can be used when applying for business loans – typically, loans which are used for purchasing buildings and equipment.
13. Can I apply for a down payment grant if I don’t need to borrow money for my business? No. Only business owners that will be applying for a loan from an approved lender are eligible to apply for a down payment grant.
14. Are existing businesses eligible to apply, or is the grant money only for starting new businesses? The down payment grants are available for new and existing businesses.
15. Is there a minimum or maximum amount of down payment grant money for which a business can apply? There is no minimum or maximum set amount. Each application will be judged on its own merit. However, each down payment grant application must be connected to a loan application that has been submitted to a qualified lender.
16. What is a business plan? A business plan is a written document that guides an entrepreneur through the key stages of launching, operating, and growing a sustainable business. It serves as a roadmap to guide the business owner, and also demonstrates to potential lenders that the owner has reasonably considered all of the challenges and opportunities of creating a sustainable business. Lenders, such as banks, require a completed business plan in order to consider a loan application. A business plan will also be required in order to apply for a down payment grant through this program. The same business plan can be provided to both the lender and the grantor; you do not need to create two different plans.
17. Is a business plan required to apply for grant money? Yes, but if you do not have one or you need assistance updating the one you have, you can sign up for this program’s entrepreneur classes and/or one-on-one assistance with one of our coaches. We encourage every entrepreneur to take advantage of all the resources this program offers when preparing the business plan. Staff will help you ensure your business plan and application is complete before it is submitted to the Review Committee.
18. I don’t need to borrow money for my business right now, so I don’t need a down payment grant. Can I still get help developing a business plan? Yes
19. Can I apply for a down payment grant if I don’t have a business plan? No. All applicants must submit a business plan. You do not need to work specifically with AADC to develop your business plan, but it is strongly encouraged and our assistance is free. You may develop the plan on your own or request assistance from another organization. Down payment grant applications that do not include a business plan will not be considered.
20. Does a business owner who has owned and operated a successful business for years still need to submit a business plan? Yes
21. Will AADC write my business plan for me? No, but our staff will help guide you through business plan development classes and provide one-on-one coaching.
22. Do I need to attend business classes at AADC in order to be eligible for a down payment grant? You are not required to attend the training classes. However, you will need to submit a business plan as part of your grant application in order to be considered for a down payment grant.
23. What paperwork do I need in order to apply for the grant? The program coordinator will provide the application form and help you with the process of applying for the grant.
24. My credit score is not great. Can I still participate in this program? Yes
25. Can I use the money to help buy something if I’m not taking out a loan? No. The grant money can only be used as a down payment for a loan.
26. Can the down payment grant be used to buy buildings? Yes
27. Can the down payment grant be used for construction or remodeling expenses? No
28. Can the down payment grant be used for land contracts? No 29. Can the down payment grant be used to buy an existing business from someone who does not belong to one of the underrepresented communities? Yes, as long as the new owner meets the eligibility criteria.
30. Can I apply for a down payment grant to help finance a loan which I already received for my business? No
31. If the applicant is starting a new business, can they apply if they already own one or more businesses? Yes
32. Is there a minimum age requirement to apply for a down payment grant? Yes, the applicant must be at least 18 years old to apply for a down payment grant. However, an entrepreneur does not need to be 18 in order to participate in the entrepreneur training classes.
33. How does the program ensure that the granted down payment is actually used to secure a loan? The down payment check will be submitted directly to the bank or qualified organization that is providing the loan.
34. How long will the program be operational? I’m worried the money will run out before I can apply. The down payment program will end on December 31, 2024, or before that date if the money runs out.
35. How many down payment grants will be given out? There is not a set number of down payment grants to be awarded. Each grant award amount is individually tied to its application. AADC’s Grant Application Review Committee will recommend approval or denial for each grant application based on the application’s own merits.
36. Are down payment grants considered taxable income? Yes. Entrepreneurs who receive a down payment grant must report a down payment grant award as income.
3 7. Who will be reviewing and approving the grant applications? AADC’s Grant Application Review Committee will be reviewing the applications and recommending approval or denial to AADC’s Board of Directors, who will make the final decision.
38. Is there a list of lenders I must choose from to get a loan? Can the loan be from a friend or family member? The business loan must be from a commercial lender, Community Development Financial Institution (CDFI), or an approved organization that offers business loans.
39. How long does the application review process for a down payment grant take? You can significantly shorten the application review process by ensuring that you have a completed business plan before you start the down payment grant application. AADC staff will help you develop your business plan.
40. How do I sign up for this program? Call AADC at 715-682-8344 and say that you would like to schedule an appointment to talk with our program coordinator.
41. Who do I call if I have more questions? Call AADC at 715-682-8344
ASHLAND AREA DEVELOPMENT CORPORATION IS A 501 (C)(3) NON-PROFIT ORGANIZATION. OUR MISSION IS TO SUPPORT INCOMING AND EXISTING ASHLAND AREA ENTREPRENEURS AND BUSINESSES.