North Central NCWCNorth Central NCWCAugust 17-19, 2009August 17-19, 2009
Chicago, ILChicago, IL
Financial Assistance ProgramsFinancial Assistance Programs
North Central NCWC – August 2009 - Page 2
Financing Growth Opportunities
Perfect Business Opportunity Found– Determine how much ‘cash’ will you need
Capital, Working Capital, Total Cash flow needs assessment• Review financial projections (expense and
income timing)» Cash flow & Working capital needs
• Review supply and equipment lists» Capital needs
– Determine how you will finance the amounts
North Central NCWC – August 2009 - Page 3
Document Plans
Complete or update Business Plan– Operational plans and organizational infrastructure
impacts– Financial Statements and Projections
Income Expense
• Operating and Capital• Cash flow
– Projection alternatives (what-ifs) Best Case Worst Case Breakeven
– Don’t forget to include loan funding and repayments (principle and interest) on Cash flow
North Central NCWC – August 2009 - Page 4
Identify Funding Sources
Internal versus External Financing– Internal
Investments Endowments Current Cash flow Unrestricted and Restricted Reserves
– External (related parties may need to be disclosed on Form 990) Banks/Financial Institutions Grants Donors Economic Development or Federal Loan Programs
• Hub Zone Financing NISH
North Central NCWC – August 2009 - Page 5
Funding Options/Challenges
– Internal Financing Loss of income Flexibility Financial strength Opportunity costs
– External Financing Covenants Loan requirements Reporting Credit worthiness Financing costs
North Central NCWC – August 2009 - Page 6
Financial Statement & Projections
Balance Sheet– Review ratios
Compare to benchmarks
• Non-profits
• Commercial
– Understand expected impact Ratio impact Liquidity reductions Debt covenants
North Central NCWC – August 2009 - Page 7
Income Statement– Review ratios and impact
Compare to benchmarks
• Non-profits
• Commercial Include depreciation and other non-cash expenses Include costs of capital/borrowing Include impacts on existing infrastructure (overhead
departments)
Financial Statement & Projections (cont’d)
North Central NCWC – August 2009 - Page 8
Cash Flow Projections for 3-years– Review business plan and environmental scan
Include best and worst case options Determine break-even point Ensure understanding of carrying costs
Financial Statement & Projections (cont’d)
North Central NCWC – August 2009 - Page 9
Equipment used to manufacture a product, provide a services, or to sell, store and deliver merchandise
– Office furniture, business equipment, machinery These items are depreciable, and their cost is expressed as “depreciation” expense on the income statement
– Depreciation is a non-cash event but is key to planning for equipment costs and replacement Need to “replace” funds to buy new
Capital Equipment List
North Central NCWC – August 2009 - Page 10
How is loan/investment to be spent?– New Equipment – Working Capital
Inventory Supplies
– Specific items to be purchased/leased How will the loan/investment make your business more successful or profitable?
Application or Expected Effect of Loan or Investment
North Central NCWC – August 2009 - Page 11
In all cases you must be compliant in
the following areas:– Applicant must be a producing CRP– Must be current in submission of invoices
and payment of NISH fees (within 30 days)– Must be in compliance with Agency and
AbilityOne ratios– Must be timely in submitting QERs and
404s
Qualifications for NISH Loans/Leases
North Central NCWC – August 2009 - Page 12
NISH Financial Resources
Resource Maximum $ Pay Back Terms
Interest-Free Loan $75,000 or 15% of projects annual PL value
Up to 3-years
Capital Equipment Loan $100,000 Up to 5-years
Capital Equipment Lease $500,000 Up to 5-years
Capacity Building Lease $500,000 Up to 5-years (PL add within 2-years)
Working Capital Short-Term Loan
Up to $200,000 6 months
North Central NCWC – August 2009 - Page 13
NISH Financial Resources (cont’d)
Resource Maximum $ Pay Back Terms
Training Incentive (Voucher) Program
Earned based on: direct labor hours, new producing CRPs, NISH EDs, and survey respondents
N/A
Disability Eligibility Documentation Grant
$500 per potential worker
N/A
Management Assistance Grant $11,500 N/A
Professional Development Grant
$11,500 N/A
Prompt Payment Discount ½ to 1% discount of net commissions due NISH
N/A
North Central NCWC – August 2009 - Page 14
Teleservices – To assist with hosting and start-up costs
– POC: Peggy Gritt, [email protected]
Secure Document Destruction– To assist with initial entry into SDD with interest-
free financing
– POC: Shawn Murphy, [email protected]
Lines of Business Specific
North Central NCWC – August 2009 - Page 15
Capital Equipment Loan Fund– Must increase direct labor hours, improve quality, or
safety, or provide an accommodation
– Interest-free if increase direct labor hours and jobs
– Low interest if no direct labor hour increase
– Interest rate is ½ of Prime per the Wall Street Journal on the date the loan is disbursed
Working Capital Short-Term Loan– Effective 10/1/09
– To assist with raw material and related inventory carrying costs
– To be repaid within 6 months
Key Points on Loans
North Central NCWC – August 2009 - Page 16
Capital Equipment Lease Program– Must increase direct labor hours– Leases are issued through Associated Bank in
Minnesota– NISH guarantees the lease balance and funds the
interest portion
Capacity Building Lease Program– Work targeted for PL Add within 2-years– Requires commitment from:
PA CRP/NPA NISH Executive Director
Key Points on Leases
North Central NCWC – August 2009 - Page 17
Management Assistance Grant Program– Fund start-up cost on new contracts– Maximum grant is the lesser of $11,500 or the salary
and benefits of the Project Manager, Supervisor, or Trainer for a 3-month period before and 1-month period after project start-up
Training Incentive (Voucher) Program– Offset expenses for NISH training, the NISH annual
conference or an NCWC meeting– Vouchers must be used within 1-year of distribution
Key Points on Grants/Vouchers
North Central NCWC – August 2009 - Page 18
Disability Eligibility Documentation Grant– Designed to assist with cost associated with
AbilityOne disability determination costs Recent survey indicates that 35% of AbilityOne
workers are self-referred Can be used for up to 2% of workers (maximum of
20 per CRP) $500 per applicable employee Brian DeAtley, [email protected] 571-226-4523
Key Points on Grants (cont’d)
North Central NCWC – August 2009 - Page 19
Professional Development Management Grant– Goal: To increase upward mobility for people with
severe disabilities to supervisory position– To assist with cost associated with the recruitment,
accommodation, training or relocation
Key Points on Grant/Program
North Central NCWC – August 2009 - Page 20
Prompt Payment Discount– It is NISH’s policy to allow CRPs to take a discount
in the amount of ½ of 1% of net commissions due to NISH if the commissions are paid by the CRP within 10 days following receipt of payment from the government
– Please contact your AR representative for correct application of the discount amount
Key Points on Payment Discount
North Central NCWC – August 2009 - Page 21
Applications: www.nish.org Required Documentation
– Annual Audited Financials– Most Recent Quarterly Financials– UCC-1 for Capital Equipment Loan– Contacts:
Lorretta Stevens [email protected] 571-226-4501
Elizabeth Goodman [email protected] 571-226-4506
Financial Assistance Contacts
North Central NCWC – August 2009 - Page 22
Questions?Questions?
Top Related