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H.398 1
Introduced by Representatives Marcotte of Coventry, Graning of Jericho, and 2
Priestley of Bradford 3
Referred to Committee on 4
Date: 5
Subject: Conservation and development; economic development 6
Statement of purpose of bill as introduced: This bill proposes to amend certain 7
provisions governing the Vermont Economic Development Authority. 8
An act relating to the Vermont Economic Development Authority 9
It is hereby enacted by the General Assembly of the State of Vermont: 10
Sec. 1. 10 V.S.A. chapter 12 is amended to read: 11
CHAPTER 12. VERMONT ECONOMIC DEVELOPMENT AUTHORITY 12
* * * 13
§ 212. DEFINITIONS 14
As used in this chapter: 15
* * * 16
(6) “Eligible facility” or “eligible project” means any industrial, 17
commercial, or agricultural enterprise or endeavor approved by the Authority 18
that meets the criteria established in the Vermont Sustainable Jobs Strategy 19
adopted by the Governor under section 280b of this title used in a trade or 20 BILL AS INTRODUCED H.398
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business whether or not such business is operated for profit, including land and 1
rights in land, air, or water; buildings; structures; machinery; and equipment of 2
such eligible facilities or eligible projects, except that an eligible facility or 3
project shall not include the portion of an enterprise or endeavor relating to the 4
sale of goods at retail where such goods are manufactured primarily out of 5
State, and except further that an eligible facility or project shall not include the 6
portion of an enterprise or endeavor relating to housing unless otherwise 7
authorized in this chapter, however, certain housing projects designed for the 8
purpose of housing employees of a business may be eligible upon consent of 9
the Vermont Housing Finance Agency. Such enterprises or endeavors may 10
include: 11
* * * 12
(T) Any capital improvement; purchase of receivables, property, 13
assets, commodities, bonds, or other revenue streams or related assets; working 14
capital program or liability; or other insurance program. 15
* * * 16
(9) “Insurance contract” means a contract insuring mortgage payments 17
under subchapter 2 of this chapter. [Repealed.] 18
* * * 19
(11) “Maturity date,” as used in subchapter 2 of this chapter, means the 20
date upon which the note or other evidence of indebtedness secured by a 21 BILL AS INTRODUCED H.398
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mortgage would be extinguished if paid in accordance with the mortgage 1
payments. [Repealed.] 2
(12) “Mortgage,” as used in subchapter 2 of this chapter, means a first 3
mortgage upon an eligible facility given by a mortgagor, as herein defined, to 4
secure the repayment of amounts borrowed to pay costs of a project. 5
[Repealed.] 6
(13) “Mortgage payments,” as used in subchapter 2 of this chapter, 7
means the periodic payments called for by a mortgage that shall cover lease 8
land rentals, if any, mortgage insurance premiums, interest, installments of 9
principal, taxes and assessments, hazard insurance payments, and any other 10
payments called for in the mortgage. [Repealed.] 11
(14) “Mortgagee,” as used in subchapter 2 of this chapter, means the 12
original lender under a mortgage and its successors and assigns, if approved by 13
the Authority. [Repealed.] 14
(15) “Mortgagor,” as used in subchapter 2 of this chapter, means the 15
original borrower under a mortgage or a security agreement and its successors 16
and assigns, if approved by the Authority. [Repealed.] 17
* * * 18
§ 213. AUTHORITY; ORGANIZATION 19
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(c) The Authority shall elect a chair from among its appointed members, 1
and a vice chair and treasurer from among its members or staff and shall 2
employ a manager who shall hold office at the Authority’s pleasure and who, 3
unless he or she the individual is a member of the classified service under 3 4
V.S.A. chapter 13, shall receive such compensation as may be fixed by the 5
Authority with the approval of the Governor. A quorum shall consist of eight 6
members. Members disqualified from voting under section 214 of this title 7
shall be considered present for purposes of determining a quorum. No action 8
of the Authority shall be considered valid unless the action is supported by a 9
majority vote of the members present and voting and then only if at least five 10
members vote in favor of the action. 11
* * * 12
(i) The Authority shall study and report back to the Legislature no later 13
than January 15, 1989 on the feasibility of hiring full-time counsel in lieu of 14
retaining outside counsel. [Repealed.] 15
§ 214. MEMBERS; DISQUALIFICAT ION 16
A member of the Authority may not participate in any decision: 17
* * * 18
(2) Upon any insurance contract under subchapter 2 of this chapter or 19
loan under subchapter 5 of this chapter, if the member is a member, director, 20
trustee, employee, or officer of; or has any interest direct or indirect in; or 21 BILL AS INTRODUCED H.398
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owns any stock, bonds, or other liabilities issued by or authorized by the 1
prospective mortgagor, mortgagee, or tenant; 2
* * * 3
§ 215. MANAGER; DUTIES 4
The manager shall be the chief administrative officer of the Authority and 5
shall direct and supervise the administrative affairs and technical activities of 6
the Authority in accordance with any rules, regulations, and policies set forth 7
by the Authority. In addition to any other duties, the manager shall: 8
* * * 9
(4) work closely with the Agency of Commerce and Community 10
Development and provide assistance to the various divisions of that Agency 11
when requested to facilitate the planning and financing of projects; 12
(5) make recommendations and reports, in cooperation with the Agency 13
of Commerce and Community Development, to the Authority on the merits of 14
any proposed project, on the status of local development corporations, and on 15
suitable industrial sites; [Repealed.] 16
(6) perform such other duties as may be directed by the Authority in the 17
carrying out of the purposes of this chapter. 18
§ 216. AUTHORITY; GENERAL POWERS 19
The Authority is hereby authorized: 20 BILL AS INTRODUCED H.398
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(1) To sue and be sued in its own name and plead and be impleaded; 1
service of process upon it in any action shall be made by service upon the 2
Secretary of State either in hand or by leaving a copy of the process at his or 3
her the Secretary’s office. 4
* * * 5
(3) To adopt and from time to time amend bylaws, and rules, and 6
regulations for the calling and conduct of its meetings and for the conduct of 7
its affairs, including regulations rules relating to applications for financial 8
assistance and disclosure of information supplied to it. 9
* * * 10
(6) To employ such employees, who may be in the classified system 11
under 3 V.S.A. chapter 13 within the discretion of the Authority, and to 12
employ or contract with agents, consultants, legal advisors, and other experts, 13
as may be necessary or desirable for its purposes, to determine the 14
qualifications, duties, and compensation of such employees, agents, 15
consultants, legal advisors, and experts and to utilize the services of other 16
governmental agencies and departments. 17
* * * 18
(9) To make such charges against local development corporations as 19
may be mutually agreed upon to assist in meeting the expenses of the 20 BILL AS INTRODUCED H.398
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Authority incurred under this chapter, including any interest charged by the 1
State Treasurer. 2
(10) To administer its own funds and to invest or deposit funds which 3
that are not needed currently to meet the obligations of the Authority. 4
* * * 5
(13) To cause to be incorporated in Vermont a nonprofit corporation that 6
will qualify as a State development company under Title 15 of the U.S. Code 7
15 U.S.C. § 695 and rules and regulations adopted promulgated pursuant 8
thereto. The voting members of the Authority shall be members of the 9
company and shall constitute the board of directors of the company. The 10
company shall have at least 14 other members selected by the members of the 11
Authority. The company shall be organized and operate under the nonprofit 12
corporation laws of the State of Vermont to the extent not inconsistent 13
herewith. The Authority shall have the power to contract with the company to 14
provide staff and management needs of the company. The Authority is 15
authorized to contribute to the capital of the company in an amount the 16
Authority determines is necessary and appropriate. 17
* * * 18
(15) To delegate to loan officers the power to review, approve, and 19
make loans under this chapter, subject to the approval of the manager, and to 20 BILL AS INTRODUCED H.398
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disburse funds on such loans, subject to the approval of the manager as set 1
forth in the policies and procedures of the Authority. 2
* * * 3
§ 217. RECORDS; ANNUAL REPORT; AUDIT 4
(a) The Authority shall keep an accurate account of all its activities and of 5
all its receipts and expenditures. Information and records in connection with 6
an application for an insurance contract under subchapter 2 of this chapter shall 7
be preserved for three years after the application has been denied or, if the 8
application is accepted, for three years after the mortgage has been discharged 9
and thereafter until the Authority orders them destroyed. 10
* * * 11
(c) The Auditor of Accounts of the State and his or her the Auditor’s 12
authorized representatives may at any time examine the accounts and books of 13
the Authority, including its receipts, disbursements, contracts, funds, 14
investments, and any other matters relating to its financial statements. 15
* * * 16
§ 217a. APPLICATION 17
Among such other things as may be required by the Authority, any 18
application for financing or for mortgage insurance under this chapter shall 19
state in detail on the application the nature and purpose of the business and its 20 BILL AS INTRODUCED H.398
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products for which the loan, or revenue bonds or mortgage insurance is are 1
intended to benefit. 2
* * * 3
§ 231. ASSISTANCE TO LOCAL DEVELOPMENT CORPORATIONS 4
Upon application of a local development corporation, the Authority may 5
loan money to that local development corporation, upon such terms and 6
conditions as it may prescribe, for the purpose of industrial park planning and 7
development, for constructing or improving a speculative building or small 8
business incubator facility on land owned or held under lease by the local 9
development corporation, for purchase or improvement of existing buildings 10
suitable for or which can be made suitable for industrial or small business 11
incubation facility purposes and for the purchase of land in connection with 12
any of the foregoing. Before the local development corporation receives such 13
funds for such purposes from the Authority, it shall give to the Authority 14
security for the repayment of the funds. The security shall be in such form and 15
amounts as the Authority may determine and shall, in each instance, include a 16
first mortgage on the land, or the leasehold, building, and appurtenances 17
financed by such funds. Loans by the Authority to local development 18
corporations for the construction of speculative buildings or improvements to 19
those buildings shall be repaid in full, including interest and other charges, 20
within 90 days after the building is occupied if the building is being sold, or 21 BILL AS INTRODUCED H.398
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within five years after the property is occupied if the building is being leased, 1
or within such period of time deemed reasonable by the Authority. Loans by 2
the Authority to local development corporations for the construction, purchase, 3
or improvement of small business incubator facilities shall be repaid in full, 4
including interest and other charges, within ten 20 years after the property is 5
occupied. 6
* * * 7
§ 244. BONDS 8
* * * 9
(b) Bonds shall bear the manual or digital signature of the treasurer of the 10
municipality and the manual, digital, or facsimile signature or signatures of the 11
mayor or a majority of the selectboard or trustees as the case may be. Interest 12
coupons, if any, shall bear the facsimile signature of the treasurer. If the 13
municipality has a corporate seal, bonds shall bear the seal or a facsimile of the 14
seal. Bonds executed in accordance with this subchapter shall be valid 15
notwithstanding that before the delivery thereof and payment therefor any or 16
all of the persons whose signatures appear thereon shall have ceased to hold 17
office. 18
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§ 253. STATE AUTHORITY PROJECTS 1
(a) The State of Vermont Authority may engage in projects within the state 2
in accordance with the provisions of this subchapter. For the purposes of this 3
section and section 254 of this title: 4
(1) The word “municipality” as used in the sections of this subchapter 5
other than this section shall mean the “State of Vermont” “Authority”; 6
* * * 7
(b) For the purposes of engaging in a project, the Authority shall act in the 8
name of the State and on its behalf of the State as its agent and instrumentality 9
for the execution of financing documents, security documents, bonds, and 10
other appropriate instruments or for the taking of any action with respect to a 11
project financed in whole or in part by the issue of bonds under section 254 of 12
this title. 13
(c) Title to or possessory interest in any eligible facility that is financed in 14
whole or in part by the issue of bonds pursuant to section 254 of this title may 15
be taken and held in the name of the State Authority. In performing its 16
functions under this section, the Authority may exercise any and all powers 17
conferred upon municipalities by this subchapter, but the Authority shall not 18
execute any financing document, security document, or bond with respect to a 19
project until the Authority has made the findings required by section 246 of 20
this title. 21 BILL AS INTRODUCED H.398
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(d) The Authority shall establish guidelines for the type and location of 1
projects that shall be considered in evaluating applications for financing under 2
this subchapter. These guidelines shall be used to prioritize projects and shall 3
include factors such as the number of permanent jobs created or retained; the 4
wage rates of the jobs created; the availability and suitability of private market 5
financing; the employment multiplier effect; the potential for alleviating 6
unemployment in distressed areas; the potential effect on the revitalization of 7
depressed commercial areas; the potential to stimulate markets for recycled 8
materials to be used as raw materials; whether the project is located in the job 9
development zone as designated under chapter 29, subchapter 2 of this title; 10
and a potential for increasing capital investment. In the consideration of 11
nonmanufacturing projects, priority shall be given to those projects located 12
within areas suffering from the loss of commercial or service enterprises, loss 13
of commercial or service sales, buildings with large vacancy rates, or 14
physically deteriorating structures. 15
§ 254. STATE BONDS 16
* * * 17
(c) Bonds issued under this section shall bear the manual, digital, or 18
facsimile signature of the manager or treasurer of the Authority and the manual 19
or facsimile signature of the Chair or Vice Chair of the Authority, or 20
authorized designee and agent; provided, however, that at least one of the 21 BILL AS INTRODUCED H.398
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foregoing such signatures shall be manual unless the bonds are to be manually 1
authenticated by a bank or trust company serving as trustee for the bonds. The 2
details of the bonds shall be fixed by the signing officers in accordance with 3
section 244 of this title. Bonds shall be sold by the signing officers at public or 4
private sale, and the proceeds thereof shall be paid to the trustee, lender, or 5
disbursing agent under the security document that secures the bonds. 6
(d) No financing or security document, or bond, or other instrument issued 7
or entered into in the name and on behalf of the State under this subchapter 8
shall in any way obligate the State to raise any money by taxation or use other 9
funds for any purpose to pay any debt or meet any financial obligation to any 10
person at any time in relation to an eligible facility financed in whole or in part 11
by the issue of the Authority’s bonds under this subchapter, except from 12
monies received or to be received under a financing or security document 13
entered into under this subchapter or except as may be required by any other 14
provision of law. Notwithstanding the provisions of this subsection, the State 15
may accept and expend with respect to an eligible facility any gifts or grants 16
received from any source in accordance with the terms of the gifts or grants. 17
* * * 18
(f) Bonds may be issued by the Authority under this subchapter for the 19
purpose of making loans to local development corporations for industrial park 20
planning and development, constructing, or improving a speculative building 21 BILL AS INTRODUCED H.398
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or small business incubator facility on land owned or held under lease by the 1
local development corporation, purchase or improvement of existing buildings 2
suitable or that can be made suitable for industrial or business incubation 3
purposes, and purchase of land in connection with any of the foregoing. 4
(1) Before issuing bonds for construction of a speculative building or 5
small business incubator facility and the purchase of land in connection 6
therewith, the Authority shall make the determinations and incorporate in its 7
minutes the findings that: 8
(A) the project is within the scope of this chapter, will be of public 9
use and benefit, and may reasonably be expected to create new employment 10
opportunities; 11
(B) the proposed site for the speculative building or small business 12
incubator facility will be located on adequate land owned or to be acquired by 13
the local development corporation or leased by the local development 14
corporation on terms satisfactory to the Authority; 15
(C) an adequate access road from a public highway is provided to the 16
proposed site and that such utilities as water, sewer, and power facilities are 17
available, or will be available when the speculative building or small business 18
incubator facility is completed; 19 BILL AS INTRODUCED H.398
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(D) the project plans comply with all applicable environmental, 1
zoning, planning, and sanitary laws and regulations of the municipality where 2
it is to be located and of the State of Vermont; 3
(E) the local development corporation is responsible and has 4
presented evidence to demonstrate its ability to carry out the project as 5
planned; 6
(F) evidence has been presented demonstrating the feasibility of the 7
site as a location for business, and additional evidence has been presented that 8
an adequate supply of labor is available within the labor market area to serve a 9
business located on the site; 10
(G) the local development corporation has made adequate provisions 11
for insurance protection of the building while it is unoccupied and suitable 12
arrangements have been made for fire protection and maintenance while it is 13
unoccupied; 14
(H) the project will be without unreasonable risk of loss to the 15
Authority, and the local development corporation is unable to secure on 16
reasonable terms the funds required for the project without the assistance of the 17
Authority; 18
(I) the financing and security documents contain provisions such that 19
under no circumstances is the State obligated directly or indirectly to pay 20
project costs; debt service; or expenses of operation, maintenance, and upkeep 21 BILL AS INTRODUCED H.398
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of the facility except from bond proceeds or from funds received under the 1
financing or security documents, exclusive of funds received thereunder by the 2
State for its own use; 3
(J) neither the financing document nor the security document 4
purports to create any debt of the State with respect to the eligible facility, 5
other than a special obligation of the State under this chapter required by 6
section 232 of this title. 7
(2) Before issuing bonds for industrial park planning and development 8
and the purchase of land in connection therewith, the Authority shall make the 9
determinations and incorporate in its minutes the findings that: 10
(A) the proposed industrial park is on adequate land owned or to be 11
owned by the local development corporation or leased by the local 12
development corporation on terms satisfactory to the Authority; 13
(B) an adequate access road from a public highway is provided to the 14
proposed site, and utilities, including water, sewer, and power facilities, are 15
available or will be available for any future tenant located in the park; 16
(C) the total industrial park will be planned by architects and 17
engineers acceptable to the Authority; 18
(D) no more than 80 percent of the fair market value of the industrial 19
park, as shown by appraisal by an appraiser acceptable to the Authority, is to 20
be financed under the loan; 21 BILL AS INTRODUCED H.398
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(E) the park project is within the scope of this chapter, will be of 1
public use and benefit, and may reasonably be expected to create new 2
employment opportunities; 3
(F) the park project complies with all applicable environmental, 4
zoning, planning, and sanitary laws and regulations of the municipality in 5
which it is to be located and of the State of Vermont; 6
(G) the local development corporation is responsible and has 7
presented evidence to demonstrate its ability to carry out the park project as 8
planned; 9
(H) evidence has been presented demonstrating the feasibility of the 10
site as a location for industry, and additional evidence has been presented that 11
an adequate supply of labor is available within the labor market area to serve 12
an industry located on the site; 13
(I) the park project will be without unreasonable risk of loss to the 14
Authority, and the local development corporation is unable to secure on 15
reasonable terms the funds required for the project without the assistance of the 16
Authority; 17
(J) the financing and security documents contain provisions such that 18
under no circumstances is the State obligated directly or indirectly to pay 19
project costs; debt service; or expenses of operation, maintenance, and upkeep 20
of the facility except from bond proceeds or from funds received under the 21 BILL AS INTRODUCED H.398
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financing or security documents, exclusive of funds received thereunder by the 1
State for its own use; 2
(K) neither the financing document nor the security document 3
purports to create any debt of the State with respect to the eligible facility, 4
other than a special obligation of the State under this chapter required by 5
section 237 of this title. 6
(3) All determinations and findings made by the Authority pursuant to 7
this section shall be conclusive Financing and security documents shall contain 8
provisions such that under no circumstances is the State obligated directly or 9
indirectly to pay project costs; debt service; or expenses of operation, 10
maintenance, and upkeep of the facility except from bond proceeds or from 11
funds received under the financing or security documents, exclusive of funds 12
received thereunder by the State for its own use. 13
(4) Financing and security documents shall not create any debt of the 14
State with respect to the eligible facility, other than a special obligation of the 15
State under this chapter. 16
(g) Bonds issued by the Authority under this subchapter may be secured, in 17
whole or in part, by mortgage insurance under subchapter 2 of this chapter 18
upon the terms and conditions set forth in subchapter 2 and in this subsection. 19
Such insurance may be in the form of reinsurance or may be for the purpose of 20
creating a loan loss reserve, in a case where the bonds are also secured by the 21 BILL AS INTRODUCED H.398
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mortgage insurance from another source. The principal amount of bonds so 1
secured outstanding at any time with respect to facilities of any one user, or 2
any related person, in any one municipality, shall not exceed $2,500,000.00. 3
For purposes of this subsection, the term “mortgagee” as used in subchapter 2 4
of this chapter shall mean the purchasers of the bonds, or where appropriate the 5
trustee under the security document; the mortgage payments to be insured shall 6
be those required to be made by the user under the financing document; and 7
bond proceeds, instead of being used to pay project costs directly, may be used 8
to purchase participation in loans originated by local banks or other responsible 9
financial institutions where the proceeds of such loans have been used to pay 10
project costs. In authorizing mortgage insurance to secure bonds, the 11
Authority shall make all of the findings and determinations set forth in 12
subsection 221(a) of this title, except that the principal of the mortgage cannot 13
exceed $2,500,000.00. In authorizing any bonds that are to be secured by 14
mortgage insurance, the Authority shall make all of the findings and 15
determinations set forth in section 246 of this title, and may make the findings 16
set forth in subdivisions 246(5) and (7) of this title, notwithstanding the fact 17
that the mortgage insurance will create a contingent liability of the Authority. 18
The creation of such contingent liability shall not be deemed to violate the 19
prohibition contained in subsection (d), and the statement required on each 20
bond that it does not constitute an indebtedness of the State may be modified to 21 BILL AS INTRODUCED H.398
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refer to the mortgage insurance. Separate series of bonds all of which are 1
secured by mortgage insurance may be combined pursuant to subsection (e) of 2
this section, and the proceeds of any payment of such mortgage insurance may 3
be allocated and applied by the trustee for the benefit of the bondholders in 4
accordance with the terms of the security document providing for the 5
combined financing All determinations and findings made by the Authority 6
pursuant to this section shall be conclusive. 7
(h) The Authority is authorized to pledge security and to enter into security, 8
insurance, or other forms of credit enhancement. A pledge in any agreement 9
shall be valid and binding from the time such pledge shall be made without any 10
physical delivery or further act, and the lien of such pledge shall be valid and 11
binding as against all parties having claims of any kind in tort, contract, or 12
otherwise, irrespective of whether such parties have notice thereof. Any such 13
pledge shall be perfected by filing of the agreement in the records of the 14
Authority and n filing need be made under any other provision of law. 15
(i) The Authority may purchase any bond issued under this subchapter 4. 16
Subject to the terms of any agreement with the bondholders, the Authority may 17
hold, pledge, resell, or cancel any bond purchased under this paragraph, expect 18
that a purchase under this paragraph shall not cause the extinguishment of such 19
bond unless the Authority cancels the bond or otherwise certifies its intention 20
that the bond be extinguished. 21 BILL AS INTRODUCED H.398
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(j) No designated member, director, officer, employee, or agent of the 1
Authority shall be liable personally on the bonds or any contract entered into 2
by the Authority or subject to any personal liability or accountability by reason 3
of the issuance of the bonds unless the personal liability or accountability is the 4
result of intentional misconduct. 5
Subchapter 5. Direct Mortgage Loans 6
§ 261. ADDITIONAL POWERS 7
In addition to powers enumerated elsewhere in this chapter, the Authority 8
may: 9
(1) Make loans secured by mortgages or other assets, which may be 10
subordinate to one or more prior mortgages or liens, upon application by the 11
proposed mortgagor obligor, who may be a private corporation, nonprofit 12
organization, partnership, person, or municipality financing an eligible project 13
described in subdivision 212(6) of this title, upon such terms as the Authority 14
may prescribe, for the purpose of financing the establishment or expansion of 15
eligible facilities. Such loans shall be made from the Vermont Jobs Fund 16
established under subchapter 3 of this chapter. The Authority may provide for 17
the repayment and redeposit of such loans as provided in this subchapter. 18
* * * 19
(3) Purchase prior mortgages secured loans and make payments on prior 20
mortgages secured loans on any eligible facility where the purchase or 21 BILL AS INTRODUCED H.398
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payment is necessary to protect any loan previously made by the Authority. In 1
addition, the Authority may sell, transfer, convey, and assign any such prior 2
mortgage or security. Monies used by the Authority in the purchase of any 3
prior mortgages mortgage or security, or any payments thereon, shall be 4
withdrawn from the Vermont Jobs Fund, and any monies derived from the sale 5
of any prior mortgages mortgage or security shall be deposited by the 6
Authority in the Vermont Jobs Fund. 7
* * * 8
§ 262. FINDINGS 9
Before making any loan, the Authority shall receive from an applicant a 10
loan application in such form as the Authority may by regulation rule 11
prescribe, and the Authority, or the Authority’s loan officer pursuant to the 12
provisions of subdivision 216(15) of this title, shall determine and incorporate 13
findings in its minutes that: 14
(1) The project is within the scope of this chapter and will increase or 15
maintain employment and expand the economy of the State. 16
(2) The project plans comply with all applicable environmental, zoning, 17
planning, and sanitary laws and regulations of the municipality where it is to 18
be located and of the State of Vermont. 19
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(5) The principal obligation of the Authority’s mortgage does not 1
exceed $5,000,000.00, which may be secured by land and buildings or by 2
machinery and equipment, or both, unless: 3
(A) an integral element of the project consists of the generation of 4
heat or electricity employing biomass, geothermal, methane, solar, or wind 5
energy resources to be primarily consumed at the project, in which case the 6
principal obligation of the Authority’s mortgage does not exceed 7
$6,000,000.00, which may be secured by land and by buildings or machinery 8
and equipment, or both; such principal obligation does not exceed 40 percent 9
of the cost of the project; and the mortgagor obligor is able to obtain financing 10
for the balance of the cost of the project from other sources as provided in the 11
following section; or 12
* * * 13
(6) The mortgagor obligor is responsible and able to manage its 14
responsibilities as mortgagor obligor and owner of the project. 15
(7) The mortgage loan has a satisfactory maturity date, in no case later 16
than 20 years from the date of the mortgage. 17
(8) The mortgagor obligor is unable to finance the project upon 18
reasonable terms without the assistance of the requested loan from the 19
Authority, or in the alternative, the granting of the loan will serve as a 20 BILL AS INTRODUCED H.398
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substantial inducement for the establishment or expansion of an eligible project 1
within the State. 2
(9) The mortgagor obligor has made adequate provision for insurance 3
protection of the project while the loan is outstanding. 4
* * * 5
§ 263. MORTGAGE LOAN; LIMITATIONS 6
(a) When it has been determined by the Authority that the establishment or 7
expansion of a particular eligible facility will accomplish the public purposes 8
of this act, the Authority may contract to loan to the mortgagor obligor an 9
amount not in excess of 40 percent of the cost of such eligible facility. In 10
addition, the Authority shall have determined that the mortgagor obligor has 11
obtained from other independent and responsible sources, such as banks and 12
insurance companies financial institutions or otherwise, a firm commitment for 13
all other funds, over and above the loan of the Authority and such funds or 14
property as the local development corporation may hold, necessary for 15
payment of all of the cost of the project, and that the sum of all these funds, 16
together with any funds, machinery, and equipment to be provided by the 17
mortgagor obligor is adequate for the completion and operation of the project. 18
(b) Any loan of the Authority under this subchapter shall be for a period of 19
time and shall bear interest at such rate as determined by the Authority and 20
shall be secured by a mortgage on the eligible facility or a lien on its assets for 21 BILL AS INTRODUCED H.398
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which the loan was made or upon the assets of a municipal communications 1
plant, including the net revenues derived from the operation thereof, or both. 2
The mortgage secured loan may be subordinate to one or more prior mortgages 3
loans, including the mortgage liens securing the obligation issued to secure the 4
commitment of funds from the independent and responsible sources and used 5
in the financing of the economic development project. Monies loaned by the 6
Authority shall be withdrawn from the Vermont Jobs Fund and paid over to the 7
mortgagor obligor in such manner as provided and prescribed by the rules and 8
regulations of the Authority. All payments of principal and interest on the 9
loans shall be deposited by the Authority in the Vermont Jobs Fund. 10
(c) Loans by the Authority for an eligible facility under this subchapter 11
shall be made only in the manner and to the extent provided in this section, 12
except, however, in those instances where an agency of the federal government 13
participates in the financing of an eligible facility by loan, grant, or otherwise. 14
When any federal agency participates, the Authority may adjust the required 15
ratio of financial participation by the local development corporation, 16
independent sources of funds, and the Authority in such manner as to ensure 17
the maximum benefit available by the participation of the federal agency. 18
Where any federal agency participating in the financing of an eligible facility 19
is not permitted to take as security a mortgage, the lien of which is junior to the 20 BILL AS INTRODUCED H.398
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mortgage of the Authority, the Authority shall be authorized to take as security 1
for its loan a mortgage junior in lien to that of the federal agency. 2
* * * 3
§ 264. ACCELERATED REPAYMENT PROVISIONS 4
Any direct mortgage loan made on or after July 1, 1988 under this 5
subchapter shall be conditioned upon the maintenance of a reasonable level of 6
employment at the facility or facilities owned by the mortgagor obligor and 7
pledged as security for the loan. For the purposes of this section, a reasonable 8
level of employment shall be deemed not to have been maintained whenever a 9
mortgagor an obligor employing 50 or more employees at such facility or 10
facilities permanently transfers, within any three-year period, 50 percent or 11
more of those employees or employment positions to any out-of-state facility. 12
Upon breach of this condition, the Authority may declare all principal and 13
interest of the mortgage loan immediately due and payable and may commence 14
foreclosure on any property held as security for the mortgage loan or take any 15
other lawful steps to obtain payment. 16
* * * 17
§ 279c. VERMONT EXPORT FINANCE PROGRAM 18
* * * 19
(e) Any excess of revenues over expenses derived from this program shall 20
be deposited in the development fund Vermont Jobs Fund. 21 BILL AS INTRODUCED H.398
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* * * 1
§ 280a. ELIGIBLE PROJECTS; AUTHORIZED FINANCING PROGRAMS 2
(a) The Authority may develop, modify, and implement any existing or 3
new financing program, provided that any specific project that benefits from 4
such program shall meet the criteria contained in the Vermont Sustainable Jobs 5
Strategy adopted under section 280b of this title, and provided further that the 6
program shall meet the criteria contained in the Vermont Sustainable Jobs 7
Strategy adopted under section 280b of this title. These programs may include: 8
(1) the Mortgage Insurance Program, administered under chapter 12, 9
subchapter 2 of this title; [Repealed.] 10
* * * 11
(7) one or more programs targeting economically distressed regions of 12
the State, and specifically including the Authority to develop a program to 13
finance or refinance up to 100 percent of the existing assets or debts of a 14
health, recreation, and fitness organization that is exempt under Section 15
501(c)(3) of the Internal Revenue Code, the income of which is entirely used 16
for its exempt purpose, that owns and operates a recreation facility located in a 17
distressed region of the State; [Repealed.] 18
* * * 19
§ 280b. THE VERMONT SUSTAINABLE JOBS STRATEGY 20
* * * 21 BILL AS INTRODUCED H.398
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(c)(1) Before adopting the Vermont sustainable jobs strategy, the Governor 1
shall direct the Authority and the Secretary of Commerce and Community 2
Development to solicit information and recommendations from the people and 3
businesses of the State. 4
(2) After soliciting information and recommendations, the Authority and 5
the Secretary shall jointly develop a proposed Vermont sustainable jobs 6
strategy. In developing a proposed strategy, the Authority and the Secretary 7
shall consider how best to integrate Vermont’s economic, social, and 8
environmental values into a Vermont sustainable jobs strategy. The Authority 9
and the Secretary shall jointly present their proposed strategy to the House 10
Committee on Commerce and Economic Development and the Senate 11
Committee on Economic Development, Housing and General Affairs meeting 12
in joint hearing. 13
* * * 14
Subchapter 15. Disaster Recovery Loan Fund 15
§ 280gg. DISASTER RECOVERY LOAN FUND 16
(a) There is established within the Authority the Vermont Disaster 17
Recovery Loan Fund, referred to in this subchapter as “the Fund,” the purpose 18
of which is to enable the Authority to provide loans and other forms of 19
financial assistance to businesses and agricultural enterprises after disasters. 20
(b) The Authority shall establish: 21 BILL AS INTRODUCED H.398
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(1) policies and procedures for the Fund that the Authority determines 1
are necessary to carry out the purposes of this subchapter; and 2
(2) financing programs necessary to ensure timely delivery of financial 3
assistance after a disaster. 4
(c) The Authority shall limit the interest rates charged for loans provided 5
utilizing funds from the Disaster Recovery Loan Fund to rates necessary to 6
cover the costs of administering the Fund. 7
(d) This is a revolving loan program and any excess of revenues over 8
expenses derived from this program shall be deposited in the Fund. 9
Sec. 2. 10 V.S.A. § 234 is redesignated and amended to read: 10
§ 234 220a. THE VERMONT JOBS FUND 11
(a) There is hereby created the Vermont Jobs Fund, hereinafter called the 12
Fund, which shall be used by the Authority as a nonlapsing fund for the 13
purposes of subchapters 3, 5, 9, and 10 of this chapter. To it shall be charged 14
all operating expenses of the Authority not otherwise provided for and all 15
payments of interest and principal required to be made by the Authority under 16
this subchapter. To it shall be credited any appropriations made by the General 17
Assembly for the purposes of subchapters 3, 5, 9, and 10 of this chapter and all 18
payments required to be made to the Authority under subchapters 3, 5, 9, and 19
10 of this chapter, it being the intent of this section that the Fund shall operate 20
as a revolving fund whereby all appropriations and payments made thereto, 21 BILL AS INTRODUCED H.398
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unless required to repay notes under the following section, may be applied and 1
reapplied for the purposes of subchapters 3, 5, 9, and 10 of this chapter. 2
Monies in the Fund may be loaned at interest rates to be set by the Authority 3
for the following: 4
(1) Loans to local development corporations under this subchapter, 5
provided that if the funds for any such loan are derived from the issue of notes 6
to the State Treasurer under section 235 of this chapter, the loan shall bear 7
interest at a rate not less than the rate on the notes chapter. 8
(2) Direct mortgage loans as described in subchapter 5 of this chapter. 9
(3) Loans for the financing of export activities under subchapter 9 of 10
this chapter. 11
(4) Other loans as the Authority may prescribe under subchapter 10 of 12
this chapter. 13
(b) In order to provide monies in the Fund for loans under this chapter, the 14
Authority may issue notes for purchase by the State Treasurer as provided in 15
section 235 of this chapter. 16
(c) Monies in the Fund may be loaned to the Vermont Agricultural Credit 17
Program to support its lending operations as established in chapter 16A of this 18
title at interest rates and on terms and conditions to be set by the Authority to 19
establish a line of credit in an amount not to exceed $100,000,000.00 to be 20 BILL AS INTRODUCED H.398
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advanced to the Vermont Agricultural Credit Program to support its lending 1
operations as established in chapter 16A of this title. 2
(d)(c) Monies in the Fund may be loaned to the Vermont Small Business 3
Development Corporation to support its lending operations as established 4
pursuant to subdivision 216(14) of this title at interest rates and on terms and 5
conditions to be set by the Authority. 6
(e)(d) Monies in the Fund may be loaned to the Vermont 504 Corporation 7
to support its lending operations as established pursuant to subdivision 216(13) 8
of this title at interest rates and on terms and conditions to be set by the 9
Authority. 10
(f)(e) The Authority may loan money from the Fund to the Vermont 11
Sustainable Energy Loan Fund established under subchapter 13 of this chapter 12
at interest rates and on terms and conditions set by the Authority. 13
Sec. 3. APPROPRIATION 14
The sum of $2,000,000.00 is appropriated from the General Fund to the 15
Agency of Commerce and Community Development to fund the Disaster 16
Recovery Loan Fund established in 10 V.S.A. § 280gg. 17
Sec. 4. EFFECTIVE DATE 18
This act shall take effect on July 1, 2025. 19