Nebraska Small Business Funding Programs

Small businesses in Nebraska have access to a diverse range of funding programs designed to help entrepreneurs and established companies grow. In this post, we break down some of the key state-level and federal programs available, along with eligibility requirements, application deadlines, and the benefits they offer.

State-Level Programs in Nebraska

Grants and Direct Financial Assistance

Small Business Assistance Act (SBAA)

• Eligibility:
  For-profit businesses with 5 or fewer employees (not counting the owner). Startups (businesses under 2 years old) qualify if the owner’s prior year income is ≤ $55,000 and net worth is ≤ $200,000 (excluding the primary home). Existing businesses (up to 5 years old) qualify if their average revenue growth is ≤25% and the owner’s net worth is ≤ $200,000. Note that owners cannot have ownership in another business.
• Application Deadlines:
  Applications are accepted in time-limited rounds. For example, one round opens on March 31, 2025, at noon (CT) and closes after 60 applications. Future rounds are announced as funding allows, and all submissions must be complete and “shovel-ready” (with a well-prepared business plan).
• Key Benefits:
  Grants are available up to $25,000 for eligible startups and up to $12,500 for existing businesses. The funds can be used for startup costs, working capital, equipment, franchise fees, or real estate (for non-passive uses). In addition, up to $10,000 in professional business services (e.g., accounting, HR, financial planning) can be combined with the grant.

Nebraska Innovation Fund – Prototype Grant

• Eligibility:
  Nebraska-based businesses with fewer than 500 employees in non-retail, value-adding industries (including high-tech and product development) qualify. Applicants must show a solid business plan and the ability to provide matching funds.
• Application Deadlines:
  Applications are accepted in cycles. Currently, the program is open through June 30, 2025 (FY2024-25 cycle). As it is competitive, early engagement with the Department of Economic Development (DED) is recommended.
• Key Benefits:
  Grants of up to $150,000 per project are available on a matching basis, meaning the business must contribute at least 50% of the project cost (or 25% for value-added agriculture projects). Funds can cover expenses like R&D labor, prototype materials, and testing, and projects must be completed within 24 months.

Nebraska SBIR/STTR Matching Grants

• Eligibility:
  Small businesses that meet federal SBIR/STTR criteria—typically for-profit U.S. companies engaging in significant R&D in Nebraska—are eligible. Companies must have either secured a federal SBIR/STTR grant or be in the application process. Nebraska provides “Phase 0” support for proposal preparation and matching for Phase I/II awards.
• Application Deadlines:
  These are generally aligned with the state fiscal year. For example, the FY2024–25 window runs from July 1, 2024, through June 30, 2025. Phase 0, I, and II applications may be submitted year-round, with cutoff dates each June.
• Key Benefits:
  • Phase 0 grants: Up to $5,000 to help offset proposal preparation costs.
  • Phase I match: Up to $150,000 (or 65% of the federal award) if a federal Phase I award (typically $50k–$250k) is won.
  • Phase II match: Up to $300,000 (or 65% of the federal award) for federal Phase II awards.
    These matching funds help cover additional R&D and commercialization costs.

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Investment and Loan Programs

State Small Business Credit Initiative (SSBCI) Programs

Nebraska’s SSBCI helps strengthen state lending and investment by partnering with private lenders and community organizations.

• Nebraska Growth Loan Fund (NGLF):
  • Eligibility: Small businesses that are “bankable or near-bankable” but need additional financing, with a focus on underserved businesses and communities.
  • Benefits: Provides up to $5 million per loan in state participation, covering typically 25% or less of the total loan, thus lowering the lender’s risk.
  • Application: Open year-round via participating lenders and Community Development Financial Institutions (CDFIs).
• Nebraska Seed and Development Fund (NSDF):
  • Eligibility: High-growth Nebraska companies (headquartered in-state) with up to 750 employees, which can attract private investment (with a required 1:1 match).
  • Benefits: Offers direct equity investment of up to $5 million, matched by an equal amount of private investment, effectively doubling available capital.
  • Application: Processed in partnership with selected venture funds; applications are on a rolling basis.

Nebraska Seed Investment Program (State Venture Capital Fund)

• Eligibility:
  Early-stage, high-growth companies in Nebraska that are developing new products, processes, or technologies, and have the potential to raise private capital. Companies must provide a viable business plan or pitch deck and show they have secured matching investment (typically funds raised within the past 6 months).
• Application:
  Continuous intake—businesses pitch to Invest Nebraska, the state’s contracted venture firm, with deals made throughout the year.
• Key Benefits:
  Offers equity investments of up to $500,000 per company, with a 1:1 match from private investors (with a lower match requirement of 25% for value-added agriculture ventures).

Microenterprise Loan and Assistance Programs

• Microenterprise Loans:
  Offered through organizations such as the Nebraska Enterprise Fund, Catholic Charities, and Community Development Resources, these loans range from $5,000 to $50,000. They are targeted at startups and micro-businesses, particularly in underserved or rural areas.
  • Application:
    These loans are available on a rolling basis, with business owners applying directly to local microloan providers.
  • Key Benefits:
    Low-interest microloans with accompanying technical assistance in business planning and training.
• Nebraska Advantage Microenterprise Tax Credit:
  • Eligibility:
    Businesses with 5 or fewer employees that make new investments or hire employees in targeted communities (typically rural or distressed urban areas).
  • Application Deadlines:
    Annual applications, with a statewide funding cap (approximately $2–3 million) that is awarded on a first-come, first-served basis—early January is recommended.
  • Key Benefits:
    A 20% refundable income tax credit on new investment or payroll, up to a total credit of $10,000 over the program’s life.

Tax Incentive Programs

ImagiNE Nebraska Act

• Eligibility:
  Open to any business committed to expanding in Nebraska by investing capital and creating new jobs. The program has multiple tiers, with the base tier requiring at least 5 new full-time jobs and $250,000 in new investment at a Nebraska facility.
• Application Deadlines:
  Open year-round, but approval must be secured before project commencement. Companies then have a performance period (typically 5 to 7 years) to meet their targets.
• Key Benefits:
  Offers performance-based tax credits, such as wage credits and investment credits, which can be used to offset state tax liabilities. Higher tiers provide additional benefits, including sales tax refunds on construction materials and personal property tax exemptions.

Community Development Block Grant (CDBG) – Economic Development

• Eligibility:
  Projects in cities or counties that qualify as low-to-moderate income areas. Businesses must agree to create jobs, often prioritizing low-to-moderate income individuals.
• Application:
  Managed in cycles, with local government units applying on behalf of businesses.
• Key Benefits:
  Provides grants or low-interest loans for business expansion activities—such as purchasing equipment, acquiring or improving real estate, or supporting working capital—with funds that may even be forgivable upon meeting certain job creation criteria.

Federal Funding Programs

U.S. Small Business Administration (SBA) Loan Programs

SBA 7(a) Loan Program

• Eligibility:
  For-profit small businesses operating in the U.S. that meet SBA size standards (typically under 500 employees or meeting certain revenue limits) and demonstrate a need for financing.
• Application:
  Applications are accepted year-round through SBA-approved lenders such as banks or credit unions.
• Key Benefits:
  Provides loans up to $5 million with long repayment terms and lower down payments, as the SBA guarantees 75–85% of the loan.

SBA 504 Loan Program

• Eligibility:
  For-profit small businesses with a tangible net worth under $20 million that plan to use the funds primarily for fixed assets like real estate or equipment.
• Application:
  The process involves working with a Certified Development Company (CDC) and a bank. Applications are processed continuously.
• Key Benefits:
  Offers long-term, fixed-rate financing (up to $5.5 million for the SBA portion) with low down payments (as low as 10%) and favorable interest rates, typically for 20–25 years.

SBA Microloan Program

• Eligibility:
  Small businesses and startups with financing needs up to $50,000. This program is designed for those with limited credit history or collateral.
• Application:
  Managed through local nonprofit intermediaries such as the Nebraska Enterprise Fund, Rural Enterprise Assistance Project (REAP), and Community Development Resources.
• Key Benefits:
  Loans average around $13,000, with terms up to 6 years, and are often accompanied by technical assistance and mentorship.

Federal Grants and Incentives

Small Business Innovation Research (SBIR) / Small Business Technology Transfer (STTR) Programs

• Eligibility:
  U.S. small businesses (typically under 500 employees) engaged in R&D projects that align with federal agency topics. SBIR is for projects conducted in-house, while STTR requires collaboration with a research institution.
• Application Deadlines:
  Deadlines vary by agency, with some having cycles in January, April, and September, among other windows.
• Key Benefits:
  Provides non-dilutive funding (grants that do not require repayment or equity dilution) to support high-risk R&D, with Phase I awards typically ranging from $50,000 to $250,000, and Phase II awards up to $750,000 or more.

Federal Tax Incentives – Opportunity Zones

• Eligibility:
  Businesses located in Qualified Opportunity Zones (QOZ) in Nebraska, which include parts of Omaha, Lincoln, and many rural counties. Investors must invest through a Qualified Opportunity Fund.
• Timeline:
  There is no direct business application; instead, investors roll over capital gains into the Opportunity Fund within 180 days, with tax deferral until December 2026 and potential tax-free growth after a 10-year hold.
• Key Benefits:
  Helps businesses attract investment by offering significant tax benefits to investors, such as deferring capital gains tax and potentially eliminating taxes on new investment appreciation.

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Each of these programs offers unique opportunities for Nebraska’s small businesses to access funding, whether through grants, loans, equity investments, or tax incentives. By exploring the options above, entrepreneurs can find tailored solutions to help drive growth and innovation in their ventures.

Sources: Nebraska Department of Economic Development; Nebraska Dept. of Revenue; Thayer County Economic Development Alliance; U.S. Small Business Administration; SBIR.gov/NIH; Tax Policy Center; USDA Rural Development.

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