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Regional 166 Direct Loan

Contact Information

Inquiries:  Contact a Regional 166 Direct Loan Program Administrator

Existing Regional 166 Loan Support Inquiries:

Glenn Van Valkenburgh
Senior Loan Officer
 (614) 387-2117


The Regional 166 Direct Loan Program ("Regional 166 Direct Loan" or the "Program") promotes economic development, business expansion, and job creation and/or retention by providing low interest loans to businesses who may have limited access to adequate capital from private sources of financing.

The Program utilizes ten local economic development agencies ("Regional Administrators") to underwrite and help administer the Program. These Regional Administrators are distributed around the State (click here for list), and they are responsible for application collection, review, and initial approvals.  They have robust economic development financing capacity, and possess strong relationships with the local financial institutions, businesses, and technical assistance communities that target aid to small businesses.

Eligible projects include those related to industry, commerce and distribution, or research activities.

Note:  Retail and refinancing projects are ineligible.  Management buyouts or leveraged buyouts of existing businesses are ineligible.

  • Land and/or building purchases - if the project involves the purchase of an existing building, the business must occupy at least 51 percent of the premises;
  • Machinery & equipment purchases;
  • Building construction and/or renovation costs - in case of construction, the business must occupy at least 60 percent of the premises;
  • Long-term leasehold improvements;
  • Ongoing fixed asset purchases; and
  • Capitalizable costs directly related to a fixed-asset purchase.

Note:  Retail and refinancing projects are ineligible.

The Regional 166 Direct Loan may finance up to 40% of allowable project costs/uses with loans up to $500,000.  Businesses seeking larger loan amounts from a program with similar guidelines should explore the 166 Direct Loan Program.

Note:  The Regional 166 Direct Loans are "take-out" financing (allowable project costs/uses must be purchased with interim financing with the Regional 166 Direct Loan disbursing upon project completion).

The Regional 166 Direct Loan interest rate is fixed at/or below local market rates.

The Regional 166 Direct Loan is based upon the useful life of the allowable project costs/uses financed with the Program proceeds and should reflect the term of the third-party financial institution loan, if applicable. 

The term for real estate is up to 20 years and the term for machinery and equipment is up to 10 years.

The Ohio Development Services Agency (DSA) requires a 10 percent minimum equity contribution in the allowable project costs/uses.  The required contribution may be higher for early stage companies and special purpose facilities.  At least 40 percent of the allowable project costs/uses must be funded by the borrower, either directly or indirectly through third party investors and/or lenders.

DSA requires job creation and/or retention within a three-year period.  Priority maybe given to eligible projects with higher wage and job creation commitments or projects located in a Priority Investment Area.

DSA requires a first and/or shared-first, priority mortgage and/or lien position on allowable project costs/uses financed with the Regional 166 Direct Loan proceeds.  DSA may require the following additional collateral or credit enhancements:

  • Personal guaranties from owners with more than 20% ownership in the company
  • Corporate guaranties from related companies
  • Full or partial letter of credit from a recognized financial institution
  • Life insurance on key business owners and/or managers
  • Other types of credit enhancement, if necessary
  • Application fee not to exceed $1,000 is due to the Program Administrators upon submitting a completed application.
  • Processing fee not to exceed 1.5% of the loan amount is due to the Program Administrator at the time of closing.
  • Annual servicing fee equal to .25% of the outstanding principal amount of the loan is pro-rated and payable monthly to the Program Administrators.
  • Actual and necessary costs incurred with respect to the processing of the loan request is reimbursed to the Program Administrator.
  • Additional one percent subordinate collateral security fee in case of loans with second collateral positions collected by the Program Administrator.

The Program Administrator imposes no pre-payment penalty.

  • The business customer or participating financial institution should contact a local Regional 166 Direct Loan Program Administrator who will perform a preliminary investigation of the customer's financing needs (the Project) and their business to evaluate if the project might be eligible for participation in the Regional 166 Direct Loan Program.
  • Applications are accepted by the Program Administrators.
  • Approval by the Regional 166 Direct Loan Program Administrator's Board is required.
  • Once approved by the Program Administrator's Board, approval is required by the Ohio Development Services Agency's Loan Action Working Group prior to being submitted to the State Controlling Board for final approval.
  • Following Controlling Board approval, the business can proceed with the project and the Program Administrator will prepare and execute loan documents outlining the terms of the loan and repayment obligation.

Note:  Businesses may not proceed with the project until Controlling Board approval.