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In a move aimed at assisting businesses affected by cutbacks at Oshkosh Corp., the Wisconsin Economic Development Corp. has approved a program that will provide short-term loans or loan guarantees of up to $250,000.

Wednesday, the agency said it had planned on launching the program in fiscal year 2015, which begins July 1, but it moved up the date in an effort to help businesses affected by the recently announced layoffs at Oshkosh Corp.

The Fox Valley's largest manufacturer says it plans to cut about 760 jobs from its military vehicle business as work slows because of the wind-down of wars in Afghanistan and Iraq.

Approximately 700 hourly positions at the company are scheduled to be eliminated in June, while 60 salaried jobs could be cut starting in July.

Oshkosh Corp. and its suppliers have been deeply affected by reductions in U.S. Department of Defense spending.

The loans are meant to help the suppliers, including parts manufacturers, metal fabricators and machine shops, prepare for other growth opportunities. Funding is for projects that may not have an immediate payoff but would provide long-term benefits, according to the WEDC.

Loan amounts will generally range from $50,000 to $250,000 and will carry a 6% interest rate. The loans will require a 50% match by the recipient, and the loan guarantees will require a 20% match.

While the pilot program is being implemented this year to assist businesses in the Oshkosh Corp. supply chain, it could be expanded to include other companies across the state, the WEDC says.

Wisconsin companies received $3.4 billion in federal government business in fiscal 2013, down from about $4 billion in 2012 and $7.2 billion in 2011, according to the Wisconsin Procurement Institute that monitors the spending.

"As national defense spending is reduced, it's imperative for Wisconsin companies that have relied primarily on defense contracts to diversify by looking at new products and/or new markets," Reed Hall, secretary and chief executive officer of the Wisconsin Economic Development Corp., said in a statement.

The loans mark the second time in the last six months the agency has taken steps to lessen the blow from Defense Department cutbacks. In December, it helped the East Central Wisconsin Regional Planning Commission secure an $837,000 federal grant to provide assistance for companies and communities affected by the cutbacks.