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Senate committee hears reauthorization for rural business investment program after proponents cite $188 million invested
Summary
Supporters told the Senate Ways and Means Committee that the program has deployed $188 million across 52 companies in 29 rural counties and that the proposed reauthorization would add funding targeted to Appalachian counties and continue job-creation safeguards.
Proponent testimony in the Ohio Senate Ways and Means Committee explained Senate Bill 110, a reauthorization of the state’s rural business investment program (referred to in testimony as the Ohio Rural Business Growth Program). Ryan Dressler, a principal with Advantage Capital, described the program’s structure and results and said $188 million has been invested across 52 companies in 29 rural counties statewide.
Dressler told the committee that federally licensed fund managers with rural business investment company or small business investment company designations raise private capital up front, invest that capital within three years in qualified rural businesses, hold investments for six years, and take no management fees under the program construct. He described two program protections: recapture of tax credits if program conditions are not met, and financial penalties for underperformance tied to required job-creation targets.
Dressler said the program focuses on smaller investments—typically $7.5 million and under per investment—and that investors are required to create net new jobs tied to tax-credit amounts. He told the committee the job requirement in the bill is one full-time-equivalent job per $30,000 of associated tax credit (with a higher per-job threshold in Appalachian counties under the sponsor’s proposal). Dressler said Advantage Capital’s funds have met or are on pace to meet those job-creation requirements and that the program’s investments, measured conservatively using Implan, have generated new tax revenue that exceeds the program’s cost to the state for his fund’s portfolio.
Business beneficiaries testified in support. Prasenjit Ray, general manager of Ohio Heat Transfer, said his company received a $3.5 million investment through the program, supports 45 Ohio jobs and plans to add at least 20 more. Ray said sourcing components from an Ohio sister company and partnering with Belmont College have helped strengthen local workforce pipelines. Michael Mallett of Virtual Remote Staffing said his company raised $3.5 million from Advantage Capital and has hired Ohio workers to provide remote registration services for clients outside the state. Ed Carter, president and COO of MIRAC, said his company invested $4.6 million in equipment supported by program financing, employs an average of 108 people across several Ohio facilities, and plans to add about 40 staff and $2.5 million in equipment investment over the next three years.
Dressler and company witnesses noted the program has historically been structured with private capital and a tax-credit incentive; the sponsors are proposing an additional allocation focused on Appalachian counties. Written proponent testimony was filed by Enhanced Capital, the Southeastern Ohio Port Authority and the Jefferson County Port Authority, according to the clerk.
No opponents testified at the hearing. Committee members asked clarifying questions about program metrics, county targeting and whether the business income deduction would be a revenue source; witnesses said data on full program impacts come from fund-level analyses and that the Appalachian designation would raise the per-job requirement but was intended to increase investment in those counties. The committee did not vote on SB 110 during the hearing.
