DOC - Automation Loan Program
DESCRIPTION OF THE AUTOMATION LOAN PROGRAM
The Department of Commerce Automation Loan Program is to assist businesses with the reduction of manual labor by updating or replacing production equipment that produces a product. This program is not designed to reduce the number of jobs but instead a reduction of manual labor by updating or replacing production equipment.
The Department will provide an 0% loan for up to 50% of the purchase price of the automation equipment but not to exceed $500,000.
Capital Investment Justification Report: The capital investment justification report will identify the piece of equipment to be added, updated and/or replaced, the cost of the equipment and identify the annual savings and/or costs. Additionally, the capital investment justification will demonstrate the pay-back period and Return on Investment.
Eligible Activities: An eligible business that is seeking to adopt technologies into their existing operations, which will help to reduce the level of manual labor.
Eligible Business: Eligible applicants are Montana based manufacturing business who are in good standing with the Montana Secretary of State or Tribal Government and Montana Department of Revenue and who derive at least 51% of their revenue from the sale of manufactured goods. The business must have been in operation in Montana for at least three years prior to the application.
Montana Manufacturing Extension Center (MMEC): is a statewide manufacturing outreach and assistance center that provides solutions to help Montana manufacturers grow, innovate and enhance their businesses.
Performance Metrics: The proposed automation will need to demonstrate the payback period of less than five (5) years and Return On Investment (ROI) of at least 20%.
Eligible business would apply directly to the program. Applications are only accepted on https://www.covidreliefmt.org/submit
Businesses are excluded from receiving funds if they are on the federal or state debarment lists or engaging in a business activity that is federally excluded like cannabis.
LOAN CEILING AND THRESHOLDS
Business may apply for an 0% deferred loan for up to 50% of the purchase price but not to exceed $500,000. If approved, the loan would be deferred for one year.
The Department ultimately determines the size of the loan and reserves the right to recommend a reduced amount.
Businesses could only apply for one loan from the program.
The Program will be partnering with an approved lender through a loan participation agreement. The lender would collect the repayment on both loans and transmit the State portion to the State. The lender will be able to charge quarter basis points on the State’s loan.
The purchase and installation of production equipment that will result in a 20% return on Investment with a payback of at least 5 years would be eligible. This would be shown through the Capital Investment Justification Report.
LOAN APPLICATION SUBMITTAL PROCESS
The eligible business would submit a pre-application to the Department of Commerce. Once the pre-application is received, then the State will contract with Montana Manufacturing Extension Center to do an inspection and assist the business in completing the Capital Investment Justification Report. The loan amount will be based on the firm costs contained in the Capital Investment Justification Report. Business then need to submit an application to a qualified lender.
DEADLINE FOR APPLICATION SUBMITTAL
Applications will be accepted on a first come – first served until all funds have been obligated.
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