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Regional 166 Direct Loan

Contact Information

Keena Ridley
Financial Incentives Manager
(614) 466-4273

Click here to see a list of the Regional 166 Local Economic Development Agencies


The Regional 166 Direct Loan Program (Regional 166 Direct Loan) promotes economic development, business expansion and job creation by providing financial assistance for allowable costs of eligible projects in the State of Ohio. This program provides low-interest loans to businesses creating new jobs or preserving existing employment opportunities in the state. Application collection and review, along with initial program approvals are handled by certified local economic development agencies.

For Whom

Eligible projects include those related to industry, commerce, distribution or research activities. Both retail and refinancing projects are ineligible for the program.

Allowable project costs include:

  • Land and/or building purchase; if the project involves the purchase of an existing building, the business must occupy at least 51% of the premises
  • Machinery & equipment purchase
  • Building construction and/or renovation costs; if the project involves new construction the business must occupy at least 60% of the premises
  • Long-term leasehold improvements
  • Ongoing businesses fixed asset purchase
  • Costs that can be capitalized which are directly related to a fixed-asset purchase


The term of the loan is based upon the useful life of the allowable project costs/uses financed and should reflect the term of the bank loan included in the project. Loan terms can be up to 15 years for financed real estate and up to 10 years for financed machinery/equipment. The interest rate is fixed at or below market rates.

How to apply

  • The initial approval responsibility lies with the Regional Agency. The loan officer and the Regional Agency's Board will approve the loan.
  • Upon approval, the loan package is sent to ODSA's Oversight Committee in the Loans & Servicing Office for review prior to submitting to the State Controlling Board. It is the responsibility of the Oversight Committee to review the loan package for information accuracy, completeness and proper due diligence. Assuming that all relevant information is submitted in the loan package, turnaround time by the Oversight Committee should take one to two days.
  • The loan package is then sent to the State Controlling Board for approval. The State Controlling Board approval process takes 10-14 business days (Note: the business may not begin their project until Controlling Board approval).
  • Following Controlling Board approval, the Regional Agency will prepare a Term Sheet that is a basic agreement between the Regional Agency and the borrower.
  • When the project is complete (certificate of occupancy issued, last piece of machinery installed, etc.) the Regional Agency will prepare and execute closing documentation and wire funds to the interim lender.

Additional Program Parameters

ODSA requires the creation or retention, within a three-year period, of one job for each $50,000 of Regional 166 Direct Loan proceeds. Priority may be given to eligible projects with higher wage and job creation commitments or projects located in a Priority Investment Area.
ODSA requires a 10% 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% of the allowable project costs must be funded by the borrower either directly or indirectly through third party investors and/or lenders.

ODSA requires a first and/or shared first priority mortgage and/or lien position on project costs/uses financed with the Regional 166 Direct Loan proceeds. ODSA 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
  • Life insurance on key business owners and/or managers
  • Other types of credit enhancement, if necessary
  • Non-refundable application fee, not to exceed $1,000, is due to the regional agency upon submitting a completed application
  • Non-refundable processing fee, not to exceed 2%, of the loan amount is due to the regional agency, which may not include all legal expenses associated with processing the loan
  • Annual servicing fee equal to ΒΌ of 1% (.25%) of the outstanding principal amount of the loan is pro-rated and payable monthly to the regional agency

ODSA imposes no pre-payment penalty.