Sec. 32-23ii. Connecticut Works Fund. Subfunds.
Sec. 32-23ii. Connecticut Works Fund. Subfunds. (a) There is created within
the authority the Connecticut Works Fund. The state acting through the authority may
provide financial assistance for economic development projects directly or in participation with any other financial institutions, funds or other persons or other sources of
financing, public or private, and may enter into any agreements or contracts it deems
necessary or convenient in connection therewith. Within the Connecticut Works Fund,
a loan subfund is created solely to provide any form of loan or other form of financial
assistance as provided in this section except for any guarantee or contract of insurance,
and a guarantee subfund is created solely to provide any form of guarantee or contract
of insurance as provided in this section. No financial assistance, nor any commitment
to provide financial assistance, shall be provided or entered into by the authority pursuant
to sections 32-23gg to 32-23ll, inclusive, which would cause the aggregate amount of
all such financial assistance and commitments then outstanding to exceed the sum of
the amounts available in the applicable subfund of the Connecticut Works Fund plus
the amount of any unpaid grants authorized to be made by the Department of Economic
and Community Development to the authority for deposit in the applicable subfund
of the Connecticut Works Fund which remain available for purposes of such subfund
pursuant to the bond authorization in section 32-23ll, provided the amount of financial
assistance in the form of any guarantee or contract of insurance shall be measured by
the portion of unpaid principal which is insured or guaranteed by the authority. Notwithstanding the above, the aggregate amount of financial assistance in the form of guarantees and contracts of insurance and commitments with respect thereto, calculated as
above, may be up to four times the sum of the amounts available in the guarantee subfund
of the Connecticut Works Fund plus the amount of any unpaid grants which remain
available and are specifically designated by the department for purposes of such subfund
pursuant to the bond authorization in section 32-23ll. Payments of insurance premiums,
principal, interest or other forms of return on investment received by the authority shall
be deposited in or held on behalf of said fund and shall be either used to provide financial
assistance for economic development projects or shall be returned to the state in whole
or in part at the discretion of the Secretary of the Office of Policy and Management,
pursuant to any such restrictions or financial obligations existing as a result of
agreements entered into by the authority under sections 32-23gg to 32-23ll, inclusive.
(b) The authority may provide financial assistance in such amounts, in such form
and under such terms and conditions as the authority shall prescribe, in written procedures adopted in accordance with section 1-121. Such procedures shall provide for returns on investment as the authority deems appropriate to reflect the nature of the risk,
provided a single project shall not receive an amount in excess of twenty-five million
dollars and shall not be for a term longer than twenty-five years.
(c) In addition to other forms of financial assistance, the authority may insure or
make advance commitments to insure all or any portion of the payments required under
any loan, bond or other form of indebtedness for an economic development project upon
such terms and conditions as the authority may establish. Such financial assistance may
be in such amounts, including provisions for the payment of fees, expenses or other costs,
insurance, payment of taxes and assessments, delinquency charges, default remedies and
other matters, as the authority determines, except that the maximum amount paid by
the authority under any guarantee or insurance agreement for any one project under
sections 32-23gg to 32-23ll, inclusive, shall not exceed fifteen million dollars.
(d) The authority may take all reasonable steps and exercise all reasonable remedies
necessary or desirable to protect the obligations or interests of the authority, including,
but not limited to, the purchase or redemption in foreclosure proceedings, bankruptcy
proceedings or in other judicial proceedings of any property on which it holds a mortgage
or other lien or in which it has an interest, and for such purposes and any other purposes
provided in sections 32-23gg to 32-23ll, inclusive, payment may be made from the
Connecticut Works Fund upon certification by the executive director that payment is
authorized under the provisions of said sections, or other sections of the general statutes,
applicable procedures or other programs of the authority.
(e) Any contract of insurance or guarantee agreement, including advance commitments executed by the executive director, shall be conclusive evidence of eligibility and
its validity shall be incontestable in the hands of an approved borrower or the party so
insured or guaranteed from the date of execution and delivery of the contract, agreement
or commitment, except for fraud and misrepresentation on the part of the borrower and
as to commitments, noncompliance with the commitment or any rules, or procedures
of the authority or provisions of sections 32-23gg to 32-23ll, inclusive, in force at the
time of issuance of the commitment.
(f) Applicants for financial assistance shall pay the costs the authority deems reasonable and necessary incurred in processing applications made under this section, including application and commitment fees, closing costs or other costs. In carrying out the
provisions of this section, any administrative expenses incurred by the authority, to the
extent not paid by the borrower or from moneys appropriated to the authority for such
purposes, may be paid from the Connecticut Works Fund.
(g) In providing financial assistance under this section, the authority shall give priority to manufacturing projects and to projects that encourage defense dependent industries
to diversify.
(P.A. 91-319, S. 3, 7; June Sp. Sess. P.A. 91-3, S. 150, 168; P.A. 93-360, S. 7, 19; P.A. 95-250, S. 1; P.A. 96-211, S.
1, 5, 6.)
History: June Sp. Sess. P.A. 91-3 changed the name of the fund from the Connecticut economic stabilization fund to
the Connecticut Works fund and changed references to major development projects to economic development projects;
P.A. 93-360 amended Subsec. (a) to create a loan subfund and a guarantee subfund and to limit the amount of financial
assistance provided pursuant to Secs. 32-23gg to 32-23ll, inclusive, and amended Subsec. (b) to increase the maximum
amount of assistance that a single project may receive, from $15,000,000 to $25,000,000, effective June 14, 1993; P.A.
95-250 and P.A. 96-211 replaced Commissioner and Department of Economic Development with Commissioner and
Department of Economic and Community Development.