New Colorado Law to Provide Funding for Small Business ESOP Program
FOR IMMEDIATE RELEASE
Boulder, CO. – May 22, 2017 – Legislature recently passed a bill that helps keep business in Colorado as well as protect and grow jobs. The bill supports the development and implementation of Employee Stock Ownership Plans (ESOP). Colorado- based Quist Valuation, is bringing their 35-years’ experience with ESOP implementation to assist local businesses through this process and to correctly prepare for the associated state-driven revolving loan program.
An ESOP is a company trust fund. Essentially, the company contributes new shares of its own stock or cash to buy existing shares making it an employee-owned company. Employees receive a percentage of shares which increase with seniority. A process called “vesting.” When employees leave the company, they receive their stock at fair market value. Also, an ESOP protects the business and keeps it local upon an owner’s sale or retirement.
Colorado’s new bill is modeled after a 2012 Iowa Law. Today, there are 174 ESOPs in Iowa covering 83,872 participants. Colorado has 110 ESOPs covering 33,926 participants.
Most companies use bank financing to start an ESOP, but attaining funds can be challenging. Thus, under new legislation, the Colorado Office of Economic Development and International Trade (OEDIT) will be responsible for: 1) educating local business about ESOP, and 2) facilitating a revolving loan program to help small businesses transition into employee-owned companies.
In addition to the OEDIT initiative, Quist will be supporting these efforts by assisting companies to determine if an ESOP is right for them and how to leverage this new revolving loan program. A custom valuation will identify the advantages and disadvantages for the business. Interested business owners can contact Quist to schedule a discussion with an expert analyst, today.
Quist Valuation was founded in 1984 and has grown into one of the nation’s leading independent business valuation and securities analysis firms. The team consists of expert Chartered Financial Analysts, Accredited Senior Appraisers, and Economists. Together they guide public and private companies and investment entities through the intricacies of financial reporting, corporate finance, tax compliance, and related litigation support.
Learn more at www.quistvaluation.com.
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Shina Culberson- President
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