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After following its progress through Congress over the past year, the Main Street Employee Ownership Act was signed into law on August 12th!

Among other elements, the Act makes the conversion of a business to employee ownership via a worker co-op or Employee Stock Ownership Plan (ESOP) eligible for Small Business Administration (SBA) 7(a) loans. Such loans, which the SBA guarantees up to 85% up to $5 million, will be a significant new tool in the box for business owners considering selling to their employees.

Additionally, the bill provides for Small Business Development Centers to provide educational and technical assistance to the business owners they work with around employee ownership. At the VEOC, we look forward to seeing how the impact of the new lending rules play out, as well as to working with the Vermont SBDC to continue growing employee ownership in the Green Mountain State!

If you'd like to dig into the details of the impact of the bill, check out this summary prepared by Rutger's University.