| 11 | 11 | | |
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| 12 | 12 | | AN ACT CONCERNING LOAN REPAYMENT TERMS AND THE MAXIMUM NUMBER OF EMPLOYEES TO QUALIFY FOR CERTAIN ECONOMIC DEVELOPMENT PROGRAMS. |
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| 13 | 13 | | |
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| 14 | 14 | | Be it enacted by the Senate and House of Representatives in General Assembly convened: |
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| 15 | 15 | | |
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| 16 | 16 | | Section 1. Section 32-7g of the 2012 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2012): |
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| 17 | 17 | | |
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| 18 | 18 | | (a) There is established within the Department of Economic and Community Development the Small Business Express program. Said program shall provide small businesses with various forms of financial assistance, using a streamlined application process to expedite the delivery of such assistance. The Commissioner of Economic and Community Development may partner with any other entity, including, but not limited to, the Connecticut Credit Consortium established pursuant to section 32-9yy, to meet the requirements of this section. A small business eligible for assistance through said program shall, as of October 27, 2011, (1) employ, on at least fifty per cent of its working days during the preceding twelve months, not more than fifty employees or not more than one hundred employees for a business described in sector 31, 32 or 33 of the North American Industrial Classification System, (2) [be a Connecticut-based business with operations in Connecticut, (3)] have been registered to conduct business [in this state] for not less than twelve months, and [(4)] (3) be in good standing with the payment of all state and local taxes and with all state agencies. |
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| 19 | 19 | | |
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| 20 | 20 | | (b) The Small Business Express program shall consist of various components, including (1) a revolving loan fund, as described in subsection (d) of this section, to support small business growth, (2) a job creation incentive component, as described in subsection (e) of this section, to support hiring, and (3) a matching grant component, as described in subsection (f) of this section, to provide capital to small businesses that can match the state grant amount. The Commissioner of Economic and Community Development shall work with eligible small business applicants to provide a package of assistance using not only the financial assistance provided by the Small Business Express program but also the Subsidized Training and Employment program established pursuant to section 31-3pp, as amended by this act, and any other appropriate state program. Notwithstanding the provisions of section 32-5a regarding relocation limits, the department may require, as a condition of receiving financial assistance pursuant to this section, that a small business receiving such assistance shall not relocate, as defined in said section 32-5a, for five years after receiving such assistance or during the term of the loan, whichever is longer. All other conditions and penalties imposed pursuant to said section 32-5a shall continue to apply to such small business. |
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| 21 | 21 | | |
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| 22 | 22 | | (c) The commissioner shall establish a streamlined application process for the Small Business Express program. The small business applicant may receive assistance pursuant to said program not later than thirty days after submitting a completed application to the department. Any small business meeting the eligibility criteria in subsection (a) of this section may apply to said program. The commissioner shall give priority for available funding to (1) small businesses creating jobs, and (2) economic base industries, as defined in subsection (d) of section 32-222, including, but not limited to, those in the fields of precision manufacturing, business services, green and sustainable technology, bioscience and information technology. |
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| 23 | 23 | | |
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| 24 | 24 | | (d) (1) There is established as part of the Small Business Express program a revolving loan fund to provide loans to eligible small businesses. Such loans shall be used for acquisition or purchase of machinery and equipment, construction or leasehold improvements, relocation expenses, working capital or other business-related expenses, as authorized by the commissioner. |
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| 25 | 25 | | |
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| 26 | 26 | | (2) Loans from the revolving loan fund may be in amounts from ten thousand dollars to a maximum of [one hundred] five hundred thousand dollars, shall carry a maximum repayment rate of four per cent and shall be for a term of not more than [five] ten years. The department shall review and approve loan terms, conditions and collateral requirements in a manner that prioritizes job growth and retention. |
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| 27 | 27 | | |
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| 28 | 28 | | (3) Any eligible small business meeting the eligibility criteria in subsection (a) of this section may apply for assistance from the revolving loan fund, but the commissioner shall give priority to applicants that, as part of their business plan, are creating new jobs that will be maintained for not less than twelve consecutive months. |
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| 29 | 29 | | |
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| 30 | 30 | | (e) (1) There is established as part of the Small Business Express program a job creation incentive component to provide loans for job creation to small businesses meeting the eligibility criteria in subsection (a) of this section, with the option of loan forgiveness based on the maintenance of an increased number of jobs for not less than twelve consecutive months. Such loans may be used for training, marketing, working capital or other expenses, as approved by the commissioner, that support job creation. |
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| 31 | 31 | | |
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| 32 | 32 | | (2) Loans under the job creation incentive component may be in amounts from ten thousand dollars to a maximum of two hundred fifty thousand dollars, shall carry a maximum repayment rate of four per cent and shall be for a term of not more than ten years. Payments on such loans may be deferred, and all or part of such loan may be forgiven, based upon the commissioner's assessment of the small business's attainment of job creation goals. The department shall review and approve loan terms, conditions and collateral requirements in a manner that prioritizes job creation. |
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| 33 | 33 | | |
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| 34 | 34 | | (f) (1) There is established as part of the Small Business Express program a matching grant component to provide grants for capital to small businesses meeting the eligibility criteria in subsection (a) of this section. Such small businesses shall match any state funds awarded under this program. Grant funds may be used for ongoing or new training, working capital, acquisition or purchase of machinery and equipment, construction or leasehold improvements, relocation within the state or other business-related expenses authorized by the commissioner. |
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| 35 | 35 | | |
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| 36 | 36 | | (2) Matching grants provided under the matching grant component may be in amounts from ten thousand dollars to a maximum of one hundred thousand dollars. The commissioner shall prioritize applicants for matching grants based upon the likelihood that such grants will assist applicants in maintaining job growth. |
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| 37 | 37 | | |
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| 38 | 38 | | [(g) Not later than June 30, 2012, and every six months thereafter, the commissioner shall provide a report, in accordance with the provisions of section 11-4a, to the joint standing committees of the General Assembly having cognizance of matters relating to finance, revenue and bonding, appropriations, commerce and labor. Such report shall include available data on (1) the number of small businesses that applied to the Small Business Express program, (2) the number of small businesses that received assistance under said program and the general categories of such businesses, (3) the amounts and types of assistance provided, (4) the total number of jobs on the date of application and the number proposed to be created or retained, and (5) the most recent employment figures of the small businesses receiving assistance. The contents of such report shall also be included in the department's annual report.] |
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| 39 | 39 | | |
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| 40 | 40 | | Sec. 2. (NEW) (Effective from passage) (a) There is established an account to be known as the "small business express assistance account" which will be a separate, nonlapsing account within the General Fund. The account shall contain any money required by law to be deposited in the account. Repayment of principal and interest on loans shall be credited to such account and shall become part of the assets of the account. All moneys received in consideration of financial assistance, including payments of principal and interest on any loans, shall be credited to the account. Moneys in the account shall be expended by the Department of Economic and Community Development for the purposes of the Small Business Express program established pursuant to section 32-7g of the general statutes, as amended by this act. |
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| 41 | 41 | | |
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| 42 | 42 | | (b) The Commissioner of Economic and Community Development may provide for the payment of any administrative expenses or other costs incurred by the department or its lender partners in carrying out the purposes of the Small Business Express program from the account established pursuant to subsection (a) of this section. |
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| 43 | 43 | | |
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| 44 | 44 | | Sec. 3. Subsection (a) of section 32-235 of the 2012 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective from passage): |
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| 45 | 45 | | |
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| 46 | 46 | | (a) For the purposes described in subsection (b) of this section, the State Bond Commission shall have the power, from time to time to authorize the issuance of bonds of the state in one or more series and in principal amounts not exceeding in the aggregate one billion fifteen million three hundred thousand dollars, provided one hundred forty million dollars of said authorization shall be effective July 1, 2011, and twenty million dollars of said authorization shall be made available for small business development. Two hundred eighty million dollars of said authorization shall be effective July 1, 2012, and forty million dollars of said authorization shall be made available for small business development, of which thirty million shall be made available for the Small Business Express program established pursuant to section 32-7g, as amended by this act. Any amount of said authorizations that are required to be made available for small business development but are not exhausted for such purpose by the first day of the fiscal year subsequent to the fiscal year in which such amount was made available shall be used for the purposes described in subsection (b) of this section. For purposes of this subsection, a "small business" is one employing not more than fifty employees. |
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| 47 | 47 | | |
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| 48 | 48 | | Sec. 4. Subsection (a) of section 31-3pp of the 2012 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2012): |
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| 49 | 49 | | |
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| 50 | 50 | | (a) For purposes of this section: |
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| 51 | 51 | | |
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| 52 | 52 | | (1) "Department" means the Labor Department; |
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| 53 | 53 | | |
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| 54 | 54 | | (2) "Eligible small business" means a business that (A) employed not more than [fifty] one hundred full-time employees on at least fifty per cent of its working days during the preceding twelve months, (B) is a Connecticut-based business with operations in Connecticut, (C) has been registered to conduct business in this state for not less than twelve months, and (D) is in good standing with the payment of all state and local taxes. "Eligible small business" does not include a retailer, as defined in section 42-371; |
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| 55 | 55 | | |
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| 56 | 56 | | (3) "Control", with respect to a corporation, means ownership, directly or indirectly, of stock possessing fifty per cent or more of the total combined voting power of all classes of the stock of such corporation entitled to vote. "Control", with respect to a trust, means ownership, directly or indirectly, of fifty per cent or more of the beneficial interest in the principal or income of such trust. The ownership of stock in a corporation, of a capital or profits interest in a partnership, limited liability company or association or of a beneficial interest in a trust shall be determined in accordance with the rules for constructive ownership of stock provided in Section 267(c) of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as from time to time amended, other than paragraph (3) of said Section 267(c); |
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| 57 | 57 | | |
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| 58 | 58 | | (4) "Related person" means (A) a corporation, limited liability company, partnership, association or trust controlled by the eligible small business, (B) an individual, corporation, limited liability company, partnership, association or trust that is in control of the eligible small business, (C) a corporation, limited liability company, partnership, association or trust controlled by an individual, corporation, limited liability company, partnership, association or trust that is in control of the eligible small business, or (D) a member of the same controlled group as the eligible small business; |
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| 59 | 59 | | |
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| 60 | 60 | | (5) "Eligible small manufacturer" means an eligible small business described in sectors 31 to 33, inclusive, of the North American Industry Classification System, that employed not more than [fifty] one hundred employees on at least fifty per cent of its working days during the preceding twelve months. |
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| 61 | 61 | | |
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| 62 | 62 | | Sec. 5. Subdivision (2) of subsection (b) of section 31-3pp of the 2012 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2012): |
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| 63 | 63 | | |
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| 64 | 64 | | (2) The department may use up to [four] ten per cent of any funds allocated pursuant to section 5 of public act 11-1 of the October special session for [the purpose of retaining outside consultants to administer] the payment of any administrative expenses or other costs incurred by the department or its outside consultants in carrying out the purposes of the Subsidized Training and Employment program. |
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| 65 | 65 | | |
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| 66 | 66 | | Sec. 6. Subsection (c) of section 31-3pp of the 2012 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2012): |
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| 67 | 67 | | |
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| 68 | 68 | | (c) (1) An eligible small business may apply to the department for a grant to subsidize on-the-job training and compensation for a new employee, where "new employee" means a person who (A) was unemployed immediately prior to employment, regardless of whether such person collected unemployment compensation benefits as a result of such unemployment, (B) is a resident of a municipality that has (i) an unemployment rate that is equal to or higher than the state unemployment rate as of September 1, 2011, or (ii) a population of eighty thousand or more, and (C) has a family income equal to or less than two hundred fifty per cent of the federal poverty level, adjusted for family size. An eligible small business may apply to the Labor Commissioner for, and the Labor Commissioner may grant, a waiver from the requirements of subparagraphs (B) and (C) of this subdivision in determining whether any person qualifies as a new employee. "New employee" does not include a person who was employed in this state by a related person with respect to the eligible small business during the prior twelve months. |
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| 69 | 69 | | |
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| 70 | 70 | | (2) Grants to eligible small businesses under the Subsidized Training and Employment program shall be in the following amounts: (A) For the first full calendar month a new employee is employed, one hundred per cent of an amount representing the hourly wage of such new employee, exclusive of any benefits, but in no event shall such amount exceed twenty dollars per hour; (B) for the second and third full calendar months, seventy-five per cent of such amount; (C) for the fourth and fifth full calendar months, fifty per cent of such amount; and (D) for the sixth full calendar month, twenty-five per cent of such amount. Grants shall be cancelled as of the date the new employee leaves employment with the eligible small business. |
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| 71 | 71 | | |
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