Grants, Free Money and Andrew Klesko

In the last few months there have been many inquiries about grants to start small businesses or to finance related expenses. Andrew Klesko's books and late-night TV ads have heightened that awareness and created a perception that the government has tall stacks of money it will hand out to anyone who asks! In fact, two of the most commonly known and used programs relate to hiring specific types of individuals who will learn a new trade on the job. In turn, the employer can receive a refund on a certain portion of the employee's wage during the specified training period. Another federal program offers tax deferments to the employer under similar on-the-job training conditions.

But as far as grants are concerned, nothing comes free. There are strings the size of aircraft carrier ropes to these programs. The grantee has to fulfill certain conditions and milestones to qualify for and receive grant proceeds. In some cases it is likely you will be reimbursed after paying the costs from your company's funds. In other cases, low-interest loans are awarded only if you're willing to set up shop in economically depressed regions. Conditions, goals, milestones and reporting procedures are very precise. In some instances you will not receive the proceeds if these parameters are not met. Government agencies are very careful about these matters. Regarding small business, most grants will likely require job creation, retention, minimal income standards for the jobs created and business location.

Keep in mind the old saw, “There is no free lunch.” It’s true. And if it sounds too good to be true---it probably is.
(Adapted from Stephen Windhaus, BankRate.com)

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