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By Teri Kirk
2013 was a very promising year for manufacturers seeking government funding opportunities, and the calendar year-end is an optimal time to plan applications for several new government funding programs launching this spring
When identifying external sources of financing for new projects, businesses tend to think inside the box and pursue lending instruments as their first choice. However, government incentive programs can be a strategic, low cost source of funds. These programs provide alternate financing in the form of grants, contributions, wage subsidies and tax credits.
According to The Funding Portal, which aggregates all government funding programs and sources of private financing for Canadian business, there were more than 900 government funding programs in Q4 of 2013 open to manufacturers across the country, representing $10.2 billion in available funding.
2014 will see the launch of several new programs that support growth and innovation in the manufacturing sector.
The first of these programs is the new $200-million, five-year Advanced Manufacturing Fund, which officially launched in December. The fund is administered by the Federal Economic Development Agency for Southern Ontario. It will provide repayable contributions ranging between $10 and $20 million to support manufacturers with both large-scale advanced activities and the development and use of cutting-edge technologies.
Eligible activities under the fund include prototyping, demonstration projects, product testing, advanced research, and technology adoption.
The initial intake period officially opened on December 9 and will close on Oct. 1, 2014.
A second intake period will begin in 2015.
The new Advanced Manufacturing Fund is only one of the programs FedDev Ontario will administer to manufacturers in 2014. Other funds include the Investing in Business Innovation program, the Investing in Business Growth and Productivity program, the Investing in Commercialization Partnerships program, the Investing in Regional Diversification program, and the Eastern Ontario Development Program (EODP).
The Government of Ontario also announced plans to introduce several new industrial stimulus measures in 2014 to assist businesses with innovation, productivity enhancements, R&D, new equipment and computer software.
These measures include expanding the existing advanced manufacturing program at Niagara College to serve more businesses, and introducing targeted measures to encourage new investments from global companies. The provincial government is also considering new measures to support capital investment, including changes to R&D tax credits to reward incremental R&D spending, and a new “pay or play” incentive where a special corporate tax could be earned back through investments in new equipment, R&D or training.
Manufacturers in the agri-processing sector should also take note of funding programs recently launched by Agriculture and Agri-Food Canada. Such programs include the $698 million AgriInnovation Initiative, which provides funding for research and development activities and facilitates the demonstration, commercialization and adoption of innovative products, technologies, processes, practices and services.
Manufacturers in the aerospace, defence, space and security sectors will want to consider applying to the new Aerospace Technology Demonstration Program, which is administered by Industry Canada and provides non-repayable contributions of up to $54 million to large-scale technology demonstration projects.
In addition to these new funding opportunities, manufacturers will want to take advantage of a new wave of government funding programs taking the form of vouchers. Vouchers are pre-paid funds flowing from a government agency to a research institution to conduct R&D, e-business or commercialization services on behalf of a business.
Ontario Centres of Excellence (OCE) recently launched the new Collaboration Voucher program, which offers four different types of vouchers to help companies develop innovative products, processes and services. With a focus on expanding export markets, voucher funding helps to support commercialization activities, to adopt new e-business tools, and to connect the private sector with research institutions to focus on sector-wide R&D challenges.
Other important government priorities that will continue to shape new funding programs are skills development, increased productivity and economic growth, and the development of new domestic and international markets.
Teri Kirk is the president & CEO of The Funding Portal