Area Development Delaware Resource Page
Direct Financial Incentives
The Delaware Strategic Fund is a flexible funding source that supports economic development programs within the state through loans and grants. The minimum level of assistance is $30,000 and is available for retention or recruitment of quality, full-time jobs, as well as for other projects including Brownfield studies and cleanups and SBIR bridge funding. Assistance is customized through a thorough project review and application process, which includes a review at the public hearing of the Council on Development Finance. Loans are made on a term basis with fixed or variable rates. Appropriate security is required as well as personal guarantees when appropriate. Grants are documented through contracts that include default and recapture provisions.
Employer Training:
The Delaware Economic Development Office administers a customized job training program for new, expanding and/or existing businesses. The employer maintains control over the quality of the work force ultimately hired. Paperwork, restrictions, and regulations are minimal. For new and expanding businesses and business retention purposes, subsidized training programs can be arranged. The amount and type of subsidy are determined by the size of the business, its potential impact on Delaware's economy, and the availability of other training resources. DEDO makes use of special state funds for training. Programs are developed to meet the stated hiring needs and skill levels of specific businesses. Industry maintains control of the hiring decision.
Competitiveness Fund:
The purpose of the Delaware Competitiveness Fund is to induce Delaware manufacturers to make capital investments to preserve and expand productivity, competitiveness and jobs at existing Delaware plant sites that face decline due to national and global competition.
- Specific Uses for the Fund:
- • Provide a matching-fund program to induce manufacturers to modernize their facilities and preserve high wage jobs.
- • Assist existing manufacturers in the transformation to updated processes that will keep the facility in operation.
- • Establish new product lines or diversify product lines.
- • Induce buyers for idled facilities that have an available workforce and the capability to manufacture products.
- • Provide low-interest loans, including loans that may be matched by commercial lending institutions through a collaborative program.
- • Encourage the location of research and development operations related to existing manufacturing.
Grants from the Competitiveness Fund may equal up to 3% of the project’s total capital investment. Loans may equal up to 95% of the total project cost. By law, the maximum amount that can be loaned or awarded is $5,000,000, however most projects fall significantly below this threshold. To be eligible for an award, the median annual salary of the new employees is $25,000 before benefits for the first year of the project. Recapture provisions are determined on a case by case basis and are included in every grant or loan agreement.
The process for obtaining Competitiveness Fund assistance requires completing an Application for Financial Assistance. Applications are first reviewed by the DEDO Internal Investment Committee and if approved will be presented at a meeting of the Council on Development Finance (CDF).
Emerging Technology Funds:
The State of Delaware is focused on creating an environment that supports the growth of technology-based companies. As a key component of the Governor's New Economy Initiative, the Delaware Economic Development Office (DEDO) offers the Emerging Technology Funds – Technology Based Seed Funds (TBSF I and TBSF II) and Pre-Venture fund to foster creation of technology-based start-ups in fields such as biotechnology, advanced materials, clean energy, information technology, and new chemical applications. The goal of these funds is to invest in “gazelle-like” entrepreneurial projects positioned for fast-growth and wealth creation. An investment from the fund will be the catalyst for an entrepreneur to start a business and a starting point to raise capital. It will give entrepreneurs a “Stamp of Approval” when entering the fund raising market.
TBSF (I and II): Provides seed equity financing up to $50,000 (TBSF I) or $100,000 (TBSF II) for start-up related expenses such as, lab equipment, working capital, office space, and patents, etc. or for a later stage in the life of a start-up company for expenses related to prototype development, prototype testing costs, etc.
Pre-Venture: Provides debt and equity financing between $150,000 up to $1,000,000 to bridge the gap that most start-ups face from point A - acquisition of seed capital to point B - going to the private markets for additional funding.
Investment Process: The first step is to submit a business plan with a completed Tech-Based Seed Fund Application or Pre-Venture Fund Application (Available online at dedo.delaware.gov). A technology review and due diligence process will be completed based on the application and the business plan. Upon approval, applicants will make a presentation to the Seed Fund or the Pre-Venture Fund Advisory Board, which makes an investment decision. The final step is presentation to and receipt of recommendation for approval from the Council on Development Finance committee. The application and investment process will take approximately 90 days or more to complete. The investment structure of each deal is not standardized and the fund structures each deal in the most appropriate manner.
Clean Energy Performance Grants:
The purpose of the Clean Energy Center Partnership is to support the work and research being conducted at the University of Delaware and Delaware State University, and to build a nationally recognized Clean Energy Center based on the strength of these institutions’ existing programs.
The state is offering matching (1:1) grants for research initiated and paid for by the industry which must be conducted by the University of Delaware and/or Delaware State University. Eligible companies can be from Delaware or surrounding states. However, the research projects must be conducted at the University of Delaware or Delaware State University. Solicitations for proposals are announced in January and June of each year.
Venture Capital Investment:
The purpose of the Venture Capital Investment is to stimulate long-term equity capital investment in emerging Delaware companies including but not limited to those that are technology-based and considered poised to grow quickly, generating jobs that enhance the standard of living in Delaware. Through a special appropriation, the Delaware Economic Development Office invests in Venture Capital firms that commit to investing those funds within the State of Delaware.
Brownfields Assistance Program:
The Delaware Economic Development Office (DEDO) administers this Program designed to assist owners and developers and encourage the redevelopment of environmentally distressed sites within the State through a matching grant program.
The program is linked with DNREC’s Brownfield assistance program and offers the lesser of up to $100,000 or 50% of the costs associated with the investigation and remediation of a Brownfield site. Phase I costs are excluded from the Program and unlike DNREC's Program; each project must have an employment impact of a minimum of 5 permanent full-time jobs.
To be eligible for DEDO’s Program, the owner, prospective owner or developer must first obtain a Brownfield Certification through The Department of Natural Resources and Environmental Control (DNREC) that recognizes the site as a Brownfield. After Certification has been obtained, an application can be sent to DEDO for evaluation and processing.
Reimbursement occurs upon receipt by DEDO of copies of paid receipts for the investigation and remediation costs incurred.
Delaware Access Program:
The Delaware Access Program is designed to give banks a flexible and extremely non-bureaucratic tool to make business loans that are somewhat riskier than a conventional bank loan, in a manner consistent with safety and soundness. It is designed to use a small amount of public resources to generate a large amount of private bank financing, thus providing access to bank financing for many Delaware businesses that might otherwise not be able to obtain such access.
The Delaware Access Program is based on a risk-pooling concept. It is an approach that is fundamentally different from the traditional type of insurance or guarantee program, such as the federal Small Business Administration 7(a) program, which guarantees a percentage of a loan on a loan-by-loan basis.
When a bank makes a loan under the program, the borrower pays a one-time premium charge, which is matched by a bank premium payment. DEDA then matches the combined total of the borrower's payment and the bank's payment. The borrower's premium payment is one of the terms of the loan to be worked out as part of the private transaction between the bank and the borrower.
Delaware State Contact:Judy McKinney-Cherry
Econ. Dev. Dir.
Delaware Economic Development Office
99 Kings Highway
Dover, DE 19901
(302) 739-4271
