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Eligible businesses must be certified by the Ohio Department of Administrative Services Equal Opportunity Coordinator as a Minority Business Enterprise (MBE). To be eligible for this program, the project for which bonding is sought must be economically feasible; and the minority business must not have defaulted on a previous bond issued by the Ohio Development Services Agency.

The maximum bonding line pre-qualification is $1 million per business. The premium for each bond requested is 2 percent of the face value of the bond. The business must demonstrate the benefit to Ohio residents by increasing employment opportunities.

The collateral and/or security are the personal guarantees (indemnity agreements) of the principals and persons substantially involved in business operations, and other such collateral as warranted.

The review and approval process begins when the company submits a bonding application; the application and supporting documentation are reviewed by the Minority Development Financing Advisory Board (which meets every fourth Tuesday). If approved, the application is submitted to State Controlling Board for approval, and a pre-qualification letter will be issued to the company to allow it to submit request(s) for actual bond issuance.

1. The applicant must meet the definition of "Minority Business" as set forth in Section 122.71(E)(1) of the Ohio Revised Code.
2. The applicant must be certified by the Equal Opportunity Division of the Department of Administrative Services as a minority business enterprise.
3. The projects for which bonding is sought must be economically sound and must benefit the people of the state by increasing opportunity for employment and by expanding minority business enterprise.
4. The applicant must not have defaulted on a previous bond issued by the Director and no general or limited partner or shareholder in the minority business enterprise may have defaulted on a previous bond issued by the Director.

The applicant must demonstrate to the satisfaction of the Director of the Ohio Development Services Agency (the Director) adequate insurance coverage on its business operation and key employees.

The applicant must have a line of credit equal to or greater than 20 percent of the bonded amount or demonstrate to the Director sufficient financial resources to justify a lesser credit facility.

The Director will require the personal guarantees against default by the principals and other persons substantially involved in the operation of the business, and other collateral or conditions as is warranted under the circumstances.

Once accepted into the program, businesses will be required to provide periodic interim information including (but not limited to) quarterly financial statements prepared by an independent certified public accountant, a license public accountant or a preparer acceptable to the Director to maintain their eligibility.

The Director will require removal of state tax liens.

The applicant shall pay a premium (in advance) for each bond to be issued by the Director not to exceed two percent of the penal sum of the bond. The premium may be adjusted upward or downward if the contract amount is changed by more than the lesser of 5% or $10,000.00.

There is no application fee for application to the Minority Business Bonding Program and there is no fee for bid bonds if the applicant's bid is not successful.

The Minority Development Financing Advisory Board will:

• Weigh financial viability (history of profits on a majority of contracts is expected), capacity to perform, and collateral
• Expect current ratios of at least .98:1 and debt ratios of less than 5:1
• Evaluate applicant's banking relationships
• Evaluate whether the applicant has demonstrated ability to compete in the private sector
• Consider the job generation potential of the project and/or applicant
• Consider the positive impact to the state of granting the requested assistance to the applicant
• Not consider the application if the applicant submits inaccurate or incomplete information or submits financial statements that are not reliable
• Not consider the application if the applicant has filed a Chapter 7 or 11 bankruptcy in the last three years

Applicants initiate the bond application process by contacting the staff of the Office of Minority Financial Incentives for a brief pre-application session to review the program's eligibility requirements. Applicants may contact the Office of Minority Financial Incentives by calling (800) 848-1300, extension 4-7708 or (614) 644-7708.

If the applicant can meet the program's eligibility requirements, the applicant must complete the Minority Business Bonding Program Application and return it to the Office of Minority Financial Incentives. Once the application package has been completed and returned to the Office of Minority Financial Incentives, our staff will review the package. If the application is found to be complete and the staff determines the applicant is eligible, the applicant will be informed that the package will be processed for submission to the Minority Development Finance Advisory Board for approval. New applicants are expected to appear before the Minority Development Finance Advisory Board when their packages are presented.

Applications for the Minority Business Bonding Program are available at the Office of Minority Financial Incentives, 77 South High Street, P. O. Box 1001, Columbus, Ohio 43266-0101, or by calling (800) 848-1300, extension 4-7708 or (614) 644-7708, or by clicking below.

Application Package