Pennsylvania office would guide businesses toward employee ownership

The Office of Employee Ownership would guide businesses and share information about employee ownership. The office would assist businesses exploring employee ownership and track employee-owned businesses across Pennsylvania. The office would report each year by December 31.

The office may direct local agencies to provide grants or loans for expert help, and may provide loans or loan guarantees for business projects. Expert-help awards may go to worker groups tied to Pennsylvania worksites. Business loans or guarantees may support groups reorganizing industrial, manufacturing, or agricultural businesses. For expert-help awards, worker groups must show a prospect for keeping or adding jobs. The state may cover no more than half the cost, and a loan may not exceed $100,000. If a group buys or improves the business, it must repay the award with interest. If it does not buy the business within a year after the study, the office decides whether repayment is feasible; some or all may become a grant if repayment is not feasible. For business loans or guarantees, the business must face major layoffs or closure, and private financing must be unavailable. The group must invest at least 10% of project costs, and a study and business plan must show a strong prospect of keeping or adding jobs. Loans or guarantees may not exceed $1.5 million per firm or 25% of project costs or loan value; loans must be secured and last no more than 20 years. The employee ownership advocate has final approval over assistance applications. If a group does not buy the business within one year after completing the study, it must report on whether it can repay the expert-help award.

The office may award grants to small retail businesses for employee ownership. Eligible businesses must be retail stores with fewer than 100 employees. Grants may support buying or converting a business to employee ownership, or expert help. A grant may not exceed $35,000. A business approved for a grant is automatically approved for financial assistance under the other program; this does not itself award that assistance.