EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
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SENATE BILL 310
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CF 2lr1080
By: Senators Elfreth, Hester, Gallion, Guzzone, and Hershey
Introduced and read first time: January 20, 2022
Assigned to: Budget and Taxation
A BILL ENTITLED
AN ACT concerning 1
Small, Minority, and Women–Owned Businesses Account – Local State of 2
Emergency 3
FOR the purpose of expanding the eligible uses of the Small, Minority, and Women–Owned 4
Businesses Account to include the provision of certain grants and the conversion of 5
certain loan amounts into grants in areas declared a local state of emergency; 6
limiting the amount of certain grants and loan amounts converted to grants that 7
may be provided to a certain business; and generally relating to the Small, Minority, 8
and Women–Owned Businesses Account. 9
BY repealing and reenacting, with amendments, 10
Article – Economic Development 11
Section 5–1501 12
Annotated Code of Maryland 13
(2018 Replacement Volume and 2021 Supplement) 14
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 15
That the Laws of Maryland read as follows: 16
Article – Economic Development 17
5–1501. 18
(a) There is a Small, Minority, and Women–Owned Businesses Account under the 19
authority of the Department. 20
(b) (1) (i) The Account shall receive money as required under § 9–1A–27 of 21
the State Government Article. 22
(ii) The Account shall receive money from the Strategic Energy 23
Investment Fund as required under § 9–20B–05 of the State Government Article. 24 2 SENATE BILL 310
(2) Money in the Account shall be invested and reinvested by the Treasurer 1
and interest and earnings shall accrue to the Account. 2
(3) The Comptroller shall: 3
(i) account for the Account; and 4
(ii) on a properly approved transmittal prepared by the Department, 5
issue a warrant to pay out money from the Account in the manner provided under this 6
section. 7
(4) The Account is a special, nonlapsing fund that is not subject to § 7–302 8
of the State Finance and Procurement Article. 9
(5) Expenditures from the Account shall only be made on a properly 10
approved transmittal prepared by the Department as provided under subsection (c) of this 11
section. 12
(c) (1) In this subsection, “eligible fund manager”: 13
(i) means an entity that has significant financial or investment 14
experience, under criteria developed by the Department; and 15
(ii) includes an entity that the Department designates to manage 16
funds received under subsection (b)(1)(i) of this section. 17
(2) Subject to the provisions of paragraph (3) of this subsection AND 18
SUBSECTION (I) OF THIS SECTION , the Department shall make grants to eligible fund 19
managers to provide investment capital and loans to small, minority, and women–owned 20
businesses in the State. 21
(3) Except for money received from the Strategic Energy Investment Fund, 22
the Department shall ensure that eligible fund managers allocate at least 50% of the funds 23
from this Account to small, minority, and women–owned businesses in the jurisdictions and 24
communities surrounding a video lottery facility. 25
(d) (1) Any money received from the Strategic Energy Investment Fund shall 26
be used to benefit small, minority, women–owned, and veteran–owned businesses in the 27
clean energy industry in the State. 28
(2) The Department shall make grants to eligible fund managers to provide 29
investment capital, including direct equity investments and similar investments and loans 30
to small, minority, women–owned, and veteran–owned businesses in the clean energy 31
industry in the State. 32
(e) Fund managers receiving grants under this section shall: 33 SENATE BILL 310 3
(1) keep proper records of funds and accounts; 1
(2) provide an annual report to the Governor and, in accordance with § 2
2–1257 of the State Government Article, the General Assembly on investment capital and 3
loans made pursuant to subsection (c) of this section; and 4
(3) be subject to audit by the Office of Legislative Audits of the Department 5
of Legislative Services. 6
(f) (1) Subject to paragraph (2) of this subsection, an eligible fund manager 7
may use money from grants received under this section to pay expenses for administrative, 8
actuarial, legal, and technical services. 9
(2) The Department shall set the maximum amount of grant money that 10
each eligible fund manager may use under paragraph (1) of this subsection. 11
(g) (1) Subject to paragraphs (2) through (4) of this subsection, an eligible fund 12
manager may use money from a grant received under subsection (d)(1) of this section to pay 13
ordinary and reasonable expenses for administrative, actuarial, legal, marketing, and 14
technical services and management fees. 15
(2) The Department shall: 16
(i) maintain all money received from the Strategic Energy 17
Investment Fund in a single account; and 18
(ii) make grant allocations to an eligible fund manager as the 19
manager advises the Department that the manager has approved and prepared to fund an 20
investment or a loan. 21
(3) Any allocation that the Department makes to an eligible fund manager 22
from the Strategic Energy Investment Fund shall include: 23
(i) the amount of the investment or loan; and 24
(ii) up to an additional 3% of the total investment or loan 25
commitment amount as a management fee for the benefit and compensation of the eligible 26
fund manager. 27
(4) An eligible fund manager that receives an allocation from the Strategic 28
Energy Investment Fund shall retain for the manager’s benefit: 29
(i) all management fees paid by the Department; and 30
(ii) all interest earned from a loan made by the eligible fund manager 31
under this subsection. 32 4 SENATE BILL 310
(h) (1) Notwithstanding any provisions in this section to the contrary, this 1
subsection applies to businesses in areas of the State that are: 2
(i) declared to be federal disaster areas; 3
(ii) subject to a federal declaration of emergency; or 4
(iii) subject to an official declaration of emergency by the Governor. 5
(2) In an area of the State described in paragraph (1) of this subsection, an 6
eligible fund manager may: 7
(i) provide financial assistance under this section to a small, 8
minority, or women–owned business in the form of a grant; or 9
(ii) convert to a grant part or all of a loan that was provided to a 10
small, minority, or women–owned business before the area was declared a federal disaster 11
area or became subject to a declaration of emergency. 12
(3) (i) The amount of any grant or loan converted to a grant under this 13
subsection may not exceed $50,000 for a single business. 14
(ii) The aggregate total of financial assistance provided in the form 15
of grants and loans converted to grants under this subsection may not exceed $10,000,000 16
in a fiscal year. 17
(I) (1) NOTWITHSTANDING ANY OTHER PROVISION OF THIS SECTION, 18
THIS SUBSECTION APPL IES TO BUSINESSES AND NONPROFIT ORGANIZATIONS IN 19
AREAS OF THE STATE WHERE THE PRINCIPAL EXECUTIVE OFFICER HA S DECLARED 20
A LOCAL STATE OF EMERGENCY UNDER § 14–111 OF THE PUBLIC SAFETY ARTICLE. 21
(2) IN AN AREA OF THE STATE DESCRIBED IN PA RAGRAPH (1) OF THIS 22
SUBSECTION, AN ELIGIBLE FUND MAN AGER MAY: 23
(I) PROVIDE FINANCIAL AS SISTANCE UNDER THIS SECTION TO 24
A SMALL, MINORITY, OR WOMEN –OWNED BUSINESS , INCLUDING NONPROFIT 25
ORGANIZATIONS , IN THE FORM OF A GRA NT; OR 26
(II) CONVERT TO A GRANT P ART OR ALL OF A LOAN THAT WAS 27
PROVIDED TO A SMALL , MINORITY, OR WOMEN–OWNED BUSINESS OR NONPROFIT 28
ORGANIZATION BEFORE THE AREA BECA ME SUBJEC T TO A DECLARATION O F 29
EMERGENCY . 30
(3) THE AMOUNT OF ANY GRA NT OR LOAN CONVERTED TO A GRANT 31 SENATE BILL 310 5
UNDER THIS SUBSECTIO N MAY NOT EXCEED $50,000 FOR A SINGLE BUSINES S OR 1
NONPROFIT ORGANIZATION . 2
(4) THE DEPARTMENT SHALL APPR OVE ANY ASSISTANCE T O A 3
BUSINESS OR NONPROFIT ORGANIZATION UNDER THIS SUBSECTIO N BEFORE A FUND 4
MANAGER DISTRIBUTES A GRANT OR CONVERTS A LOAN TO A GRANT . 5
[(i)] (J) The Legislative Auditor shall audit the utilization of the funds that are 6
allocated to small, minority, and women–owned businesses by eligible fund managers 7
under subsection (c)(3) of this section during an audit of the applicable State unit as 8
provided in § 2–1220 of the State Government Article. 9
[(j)] (K) (1) On or before October 1 each year, the Department shall submit a 10
report on the status of money received from the Strategic Energy Investment Fund under 11
subsection (d) of this section to the Senate Finance Committee and the House Economic 12
Matters Committee, in accordance with § 2–1257 of the State Government Article. 13
(2) With respect to the preceding fiscal year and each relevant prior fiscal 14
year, the report shall include: 15
(i) the amounts received from the Fund; 16
(ii) the amounts placed as grants with eligible fund managers; and 17
(iii) with respect to each eligible fund manager: 18
1. the identity of the manager; 19
2. the money provided to the manager; 20
3. the investments made by the manager; 21
4. the amounts retained by the manager as expenses and 22
management fees; 23
5. the small, minority, women–owned, and veteran–owned 24
businesses receiving the investments; and 25
6. the status of the investments listed under item 5 of this 26
item, along with any return made on each investment. 27
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 28
1, 2022. 29