Michigan Pilot Program to Encourage Employee Ownership Transitions Launched
The Michigan Department of Labor and Economic Opportunity has launched a $500,000 pilot program to help business owners consider employee ownership as a transition option. The program will be run in conjunction with the Michigan Employee Ownership Center (MICEO), which will administer the program.
“Employee ownership is a powerful tool for preserving local businesses, empowering workers and building a more resilient economy,” said Lt. Governor Garlin Gilchrist II. “This investment is about keeping jobs in Michigan communities and giving workers a real stake in the future of the businesses they help build every day.”
The program allocates $400,000 to help businesses pay for feasibility assessments and other costs of setting up a plan. The MICEO will lead a statewide marketing and outreach program. The MICEO will also develop best practices for employee ownership trusts (EOTs), a growing part of the employee ownership community.
MICEO Executive Director Roy Messing stated:
MICEO is grateful for the Employee Ownership Grant Program awarded by the Michigan Department of Labor and Economic Opportunity. This grant will help owners of companies offset costs to explore an ownership sale to the employees, which helps retain businesses, jobs, and economic vibrancy in the local community. This grant will also provide funding to establish best practices in establishing an employee ownership trust (EOT). EOTs, which originated in the United Kingdom, are a relatively new employee ownership structure in the United States. ESOP rules and regulations are well established in the US. The EOT best practices should provide a more consistent approach to the trust formation as more people start adopting this form of employee ownership.
Michigan has become the fifth state to create a state employee ownership program in the last few years, joining Colorado, Massachusetts, New Jersey and Washington State. The Washington program, however, did not receive funding for the next fiscal year.
Apply for the Michigan program here and come to our upcoming NCEO Forum this August to learn all about EOTs at the full-day EOT workshop.