There are many ways to approach business government grants. One way is to view them as a way to increase visibility for your business. Another is the tangible benefits you receive from the grant. An obvious benefit is the actual money you use to grow your business. A secondary benefit is the relationships you will establish with government officials as a result of the grant award.
Government grants for business activities can be difficult to secure. Local government business grants are not necessarily easier to obtain. Even less money is available at the local level. While the majority of funding for business grants is at the federal level, these funds are sometimes allocated to state governments for distribution. The idea here is that state governments are in a better position to develop grant opportunities that address state issues and constituent needs.
State funds will be divided in three distinct ways. One pot of funds will be set aside for discretionary use by various departments within the state government. The second will be used for state-level grant activities to be available to businesses throughout the state. The third will be re-allocated to local jurisdictions, primarily urban areas, to be used as they see fit.
Local governments rarely create grants for business opportunities. They may, instead, use funds for community development projects that include business expansion activities. At the local level, you should work with your councilperson or mayor’s office to gain access to discretionary funds for your business.
State governments are the best source for government business grants to purchase equipment such as manufacturing equipment. One caveat here is that these grants for business are typically tied to adding jobs to the community. Once you receive the grant, if you are unable to add jobs as planned, your grant is likely to convert to a loan. You will be required to repay the loan over a pre-established time period.
Government grants for business development may seem to have strings attached, but in reality, all grants require the same commitment. If you are unable to complete grant requirements, you must return the grant. For businesses, governmental entities prefer to convert the grant to a loan so the business is not penalized for something that may be beyond their control.
State governments give significant business development dollars to regional business incubators. If you are a start-up business, you may be able to get business government grants directly from a nearby incubator. Your state’s website will have a list of all state-funded business incubators.