Governor Steve Bullock today announced the new Montana Working Capital program which builds off the Montana Loan Deferment program by allowing Montana businesses to take out a new loan to support economic recovery.
“We are getting money out the door to keep employees on the job, support Montana businesses, and ensure long-term stability,” said Governor Bullock. “With this new program, we can continue to support our economic recovery, while continuing to protect the health and safety of Montanans.”
“Bankers in Montana are doing everything they can to assist businesses impacted by the economic crisis, and both the loan deferment and the new working capital program give them vital new tools in their toolboxes to help businesses regain profitability. We have worked closely with the Board of Investments for months in crafting programs that are truly beneficial for business owners and are easily implemented by banks. The Bullock Administration is to be commended for its tremendous efforts in throwing a lifeline to Montana businesses working through their community banks,” said Cary Hegreberg, President/CEO, Montana Bankers Association
The Montana Working Capital program will allow Montana businesses to take out a new loan to be used for payroll, employee benefits, lease or rent, inventory, utilities, and insurance. Utilizing the unused portion of the $125 million allocated to the Montana Loan Deferment program, new borrowers can work through an approved lender to take out a loan with 35 percent of it granted through Coronavirus Relief Funds. The borrower would be responsible for making payments on the remaining 65 percent of the loan. The maximum loan size is $500,000 with a grant of $175,000. The borrower would then be responsible for making payments on the remaining $325,000.
To be eligible, borrowers must have experienced a 15 percent reduction in gross revenue attributed to the direct or indirect impacts of COVID-19. The rates and terms will be determined by the lender and borrower. Like the Montana Loan Deferment program, the new Montana Working Capital program will be run by the Board of Investments, in partnership with Montana banks and credit unions, and will begin accepting loan applications on Tuesday, September 8.
The Montana Loan Deferment program, launched in June, defers payments on existing loans for six to twelve months. Over $36 million has been awarded to over 1,000 Montana businesses to defer $115 million in payments by businesses. For every dollar awarded, Montana businesses receive $3 in direct benefit. The state of Idaho is working to replicate this program for Idaho businesses.
Nearly $1 billion of $1.25 billion in Coronavirus Relief Funds have been allocated with over $372 million of that awarded, including in grants to support nearly 12,000 Montana businesses and organizations. There are new applications being reviewed for accuracy and compliance in accordance with federal guidelines daily and additional funds are awarded daily. A transparency dashboard is available to provide information on which businesses dollars are going to, in every community of the state, at: https://commerce.mt.gov/Montana-Coronavirus-Relief/Awarded-Grants.