Anchoring
Jobs in Ohio's Communities
IS
A PLANT IN YOUR AREA IN DANGER OF SHUTTING DOWN? CAN ANYTHING BE DONE TO KEEP
IT OPEN?
Employee ownership might be the answer to continued operation of the facility.
It is certainly an option worth checking out and it may be the only alternative
to a plant closure and the loss of jobs to the community.
HOW DO YOU FIND OUT?
If the employer is willing to sell to the employees and if the employees are interested
in buying the operation, the next step is to have a professional conduct a preliminary
feasibility study to determine if the plant in question can survive competitively,
under what conditions and whether employee ownership is a workable alternative.
After all, everyone should enter such an arrangement with their eyes open and
all the options and chances for success laid out.
Prefeasibility studies cost
money, something that is likely to be in short supply for a group of workers staring
at a plant closure or massive layoff. That’s where the prefeasibility study
grant program can be of valuable assistance.
WHAT IS THE PREFEASIBILITY STUDY GRANT PROGRAM?
The federal Workforce Investment Act of 1998 (WIA) continues the prefeasibility
study grant program originally authorized by the Job Training Partnership Act
(JTPA), to provide monies for such studies. The Ohio Department of Job & Family
Services (ODJFS) has contracted with the Ohio Employee Ownership Center (OEOC)
at Kent State University to administer prefeasibility study grants in the State
of Ohio.
Ohio is a national leader in funding prefeasibility studies and has
funded 30 such studies since 1991. Seven led to ESOPs, eight shut down anyway,
three were retained by existing ownership utilizing the findings of the prefeasibility
studies, seven were bought by outside buyers, two showed that an ESOP was not
feasible and three are pending.
Saving jobs is a smart thing to do. It can
expand the local labor market and the local economy while saving the State many
thousands of dollars by eliminating the need for unemployment compensation payments
and other social services.
HOW THE PROGRAM WORKS
Monies are available to buyout committees that are exploring whether employee
ownership makes sense in their company. The prefeasibility study is expected to
determine whether further feasibility work and a business plan are warranted and
to do so rather expeditiously. In shutdown situations, time is of the essence
and swift action usually improves chances for success.
To be eligible for
a grant, there has to be a clear threat of job loss or shutdown. There also needs
to be an established buyout committee to act on behalf of the employees as buyers
and the committee generally needs to raise some matching funds.
The size of
the prefeasibility study grant is typically in the $10,000 to $20,000 range, but
larger grants are possible when there is particular justification.
The application
process is simple and quick. Click
here for the application form. Or contact us at:
