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    CHAPTER 60ENTREPRENEURIAL VENTURESASSISTANCE (EVA) PROGRAM261—60.1(15)  Purpose and administrative procedures.    60.1(1)    Purpose.  The department of economic development administers the entrepreneurial ventures assistance (EVA) program. The purpose of the entrepreneurial ventures assistance program is to encourage the development of entrepreneurial venture planning and managerial skills in conjunction with the delivery of a financial assistance program for business start-ups and expansions.  60.1(2)    Administrative procedures.  The EVA program is subject to the requirements of the department’s rules located in 261—Part VII, additional application requirements and procedures, and 261—Part VIII, legal and compliance.261—60.2(15)  Definitions.  In addition to the standard definitions located in 261—Chapter 173, the following definitions apply to the EVA program:
    "Early-stage industry company" "early-stage company" means a company with three years or less of experience in a particular industry.
    "Eligible applicant" means an individual or business that has consulted with and obtained a letter of endorsement from an IDED-approved business accelerator or from another IDED-recognized entrepreneurial development organization.
    "Eligible business" means a start-up company, an early-stage company, or an existing company that is developing a new product or technology.
    "EVA" means the entrepreneurial ventures assistance program, authorized by Iowa Code sections 15.338 and 15.339.
    261—60.3(15)  Eligibility requirements.    60.3(1)  In order to be eligible for assistance, the business, or proposed business, must be located in the state of Iowa.  60.3(2)  If the business is a sole proprietorship or a partnership, all applicable business owners must apply. If the business is a limited liability company, a limited liability partnership, or a corporation, the application must be submitted and signed by an individual who has been authorized by the business to do so.  60.3(3)  In order to be eligible for assistance, the business owner or owners (or appropriate individual(s) in a limited liability company, limited liability partnership or corporation) must consult with and obtain a letter of endorsement from an IDED-approved business accelerator or from another recognized entrepreneurial development organization such as a John Pappajohn Entrepreneurial Center (JPEC), a Small Business Development Center (SBDC), or an equivalent organization recognized by IDED.  60.3(4)  In order to be eligible for assistance, the individual or business must have a business plan which details the business’s growth strategy, management team (if applicable), production/management plan, marketing plan, financial plan, and other standard elements of a business plan.261—60.4(15)  Financial assistance.  Applicants may apply to IDED for financial assistance to assist with their business start-up or early-stage growth. The applicant may request up to $250,000 for start-up or early-stage growth activities to be used for business expenses and to leverage conventional financing from commercial lenders or private investors. Assistance will generally be made in staged investments with amounts to be determined by company development, growth, and defined milestones. The assistance under this program is limited to 50 percent or less of the total original capitalization, if a new business, or total project costs, if an existing business. Funds may be used to purchase machinery, equipment, or software, or for working capital needs, or other business expenses deemed reasonable and appropriate by IDED. Awards will be in the form of an equitylike investment (e.g., royalty agreement, deferred loan). A single recipient is limited to $250,000 in total financial assistance.261—60.5(15)  Technical assistance.  Applicants may also apply for assistance in paying for consulting, or technical assistance, either in conjunction with the request for financial assistance, or after a period of time that the business has been in operation. Technical assistance of this nature is limited to no more than $25,000 per applicant.261—60.6(15)  Application process.  Applications must be submitted in the format required by the department. Applications, the business plan, and related material shall be submitted on line or by mail to Entrepreneurial Ventures Assistance Program, Division of Business Development, Business Finance, Iowa Department of Economic Development, 200 East Grand Avenue, Des Moines, Iowa 50309.261—60.7(15)  Review criteria.    60.7(1)  Applications will first be reviewed for completeness. If additional information is required, the program staff shall send the applicant notice to submit the additional needed information. The applicant shall submit the requested information within a reasonable time period in order to ensure further action on the request.  60.7(2)  The applications will then be reviewed for content of the business plan, and an evaluation of the business’s potential viability and potential for growth. The department may consult with the JPEC centers, or other knowledgeable agencies or individuals, as a part of the review process.  60.7(3)  The following items will be reviewed and evaluated:  a.    Type of business.    (1)  Highest priority will be given to businesses in sectors of the Iowa economy with the greatest start-up and growth potential for Iowa, including but not limited to:
    1. Biotechnology (including drugs and pharmaceuticals and value-added agricultural products);
    2. Recyclable materials;
    3. Software development and computer-related products;
    4. Advanced materials;
    5. Advanced manufacturing; and
    6. Medical and surgical instruments.
      (2)  Assistance may be provided to industries other than those listed in “1” through “6” above; however, the applicant will have to provide a strong rationale regarding how that industry diversifies, strengthens or otherwise enhances Iowa’s economy. Eligibility may be established by an industry other than those listed if that industry can provide rationale regarding the industry’s benefit to Iowa’s economic base. Rationale that is provided will be reviewed by department staff to determine eligibility as a targeted industry. Items that will be considered in determining an industry’s benefit to Iowa’s economic base will include:
    1. The majority of the products or services produced by the industry are exported out of Iowa;
    2. The inputs for the products produced in the industry are raw materials available in Iowa or are provided by Iowa suppliers;
    3. The goods or services produced by this industry diversify Iowa’s economy;
    4. The goods or services provided by the industry resulted in, or will result in, a decrease in the importation of foreign-made goods into the United States;
    5. The industry shows potential for future growth;
    6. The functions of the industry do not produce harmful effects for Iowa’s natural environment; and
    7. Whether the average wages of the majority of the occupations in the industry are above the statewide average wage.
    Businesses engaged in retail sales, personal services, consulting, franchises, the provision of health care or other professional services, and distributors of products or services will not be considered targeted industries and are not eligible for this program.      b.    Management team and management expertise.  Factors considered here would be whether the applicant(s) has a background (including education, training, work experience, and other factors) which will be helpful and useful in the business in question. Also considered would be the degree to which the applicant’s background is fully documented.  c.    Business capitalization.  Factors considered here would be the original sources of financing for the business. Although all projects must have at least 50 percent of their financing from sources other than the EVA program, preference would be given to those applications where the other sources of financing were even higher than 50 percent.  d.    Strength of business plan.  Factors considered here would be the quality of the business plan and how well it addresses all elements of the business, such as:
    1. A description of the company and the overall industry;
    2. The product and production plan;
    3. The market, competition, and the marketing strategy;
    4. The management team and business operations;
    5. Patent issues (if applicable), critical risks and problems; and
    6. Financial information and plan.
    The strength of the business plan will be the most important factor in the evaluation and rating of applications. Rating factors in paragraphs “a,” “b,” and “c” above will be evaluated as either satisfactory or not satisfactory. However, the business plan will be rated on an actual numerical or comparative scale. Those applications which are satisfactory on factors in paragraphs “a,” “b,” and “c” above and which rate highest on strength of business plan will be funded first.    261—60.8(15)  Negotiation, decision, and award process.  Rescinded IAB 7/4/07, effective 6/15/07.261—60.9(15)  Monitoring, reporting, and follow-up.  Rescinded IAB 7/4/07, effective 6/15/07.261—60.10(15, 83GA, SF344)  Applicability of EVA program after July 1, 2009.    60.10(1)  Effective July 1, 2009, the EVA program is rescinded by 2009 Iowa Acts, Senate File 344, section 9, and replaced with the grow Iowa values financial assistance program. Rules for the grow Iowa values financial assistance program may be found in 261—Chapter 74.  60.10(2)  For awards made prior to July 1, 2009, the rules of 261—Chapter 60 shall govern for purposes of contract administration and closeout of projects. A contract amendment is not allowable if the result of the amendment is to increase the benefits available.This rule is intended to implement 2009 Iowa Acts, Senate File 344.Related ARC(s): 7970B, 8145BThese rules are intended to implement Iowa Code sections 15.338 and 15.339.    Related ARC(s): 7970B, 8145B