Sec. 32-23x. Comprehensive Business Assistance Fund.
Sec. 32-23x. Comprehensive Business Assistance Fund. (a) As used in this
section:
(1) "Affiliate" means a business concern which directly controls or is controlled by
another business concern, or a third party which controls both business concerns;
(2) "Authority" means the Connecticut Development Authority established under
section 32-11a or its successor;
(3) "Department" means the Department of Economic and Community Development or its successor agency;
(4) "Enterprise zone" has the same meaning as provided in section 32-70;
(5) "Impacted business" means any person impacted by (A) a disaster caused by
natural forces including, but not limited to, floods or hurricanes or (B) an economic
emergency including, but not limited to, an existing or threatened major plant shutdown,
business disruption from a major road or bridge repair project or other existing or potential economic emergency, provided such disaster or emergency described in subparagraph (A) or (B) of this subdivision is proclaimed as such by declaration of the Commissioner of Economic and Community Development, with the consent of the Secretary
of the Office of Policy and Management, upon a determination by the Commissioner
of Economic and Community Development that such disaster or emergency is of a
magnitude that could materially affect the health or well-being of the citizens of the
impacted area and that the financial assistance provided for under this section is necessary to assure timely and effective relief and restoration;
(6) "Loans" means loans and extensions of lines of credit;
(7) "Minority business enterprise" means any person who meets the criteria contained in section 4a-60g and who is receiving a state contract award;
(8) "Person" means any person or entity, including affiliates, engaged in a for-profit
activity or activities in this state and who, except for an impacted business, is not an
eligible borrower for assistance under the provisions of the Connecticut Growth Fund
established under section 32-23v;
(9) "Rate of interest" means the interest rate which the authority shall charge and
collect on each loan made by the state under this section, which rate shall not exceed
one per cent above the interest rate borne by the general obligation bonds of the state
last issued prior to the date such loan is made, provided, such rate shall not exceed the
maximum allowable under federal law;
(10) "Small contractor" means any person who is a contractor, subcontractor, manufacturer or service company who has been in business for at least one year prior to
the date of its application for assistance under this section and whose gross revenues,
including revenues of affiliates, did not exceed three million dollars in its most recently
completed fiscal year prior to the date of its application for assistance under this section;
(11) "State or local development corporation" means any entity organized under
the laws of this state which has the authority to promote and assist the growth and
development of business concerns in the areas covered by their operations;
(12) "Targeted business" means a person located in an enterprise zone whose gross
revenues did not exceed three million dollars in its most recently completed fiscal year
prior to the date of its application for assistance under this section, or if such person has
not been in business for at least one year prior to the date of such application, if the
authority determines in its discretion that such person's gross revenues, including revenues of affiliates, are not likely to exceed three million dollars in its first fiscal year;
(13) "Water facilities" means (A) investor-owned water companies which supply
water to at least twenty-five but less than ten thousand customers, (B) municipally-owned water companies, and (C) owners of privately and municipally-owned dams
which the Commissioner of Environmental Protection has determined benefit the public.
(b) In order to stimulate and encourage the growth and development of the state
economy, the Comprehensive Business Assistance Fund is hereby created to provide
financial assistance to targeted businesses, businesses impacted by economic emergencies and natural disasters, businesses located in certain regions of the state and certain
industry sectors, including businesses located in entertainment districts designated under section 32-76 or established under section 2 of public act 93-311*, and to assist in
the development of clean water facilities. The state, acting through the authority, may
make or participate with private sector financial institutions in making loans from said
fund to persons in accordance with the provisions of this section. Payments of principal
and interest on such loans, and funds received by the authority from any other source
for the purposes of the Comprehensive Business Assistance Fund, shall be deposited
into said fund and shall be used to make additional loans and for such other purposes
authorized by this section.
(c) The state, acting through the authority, may make, or participate with private
sector financial institutions in making loans from the Comprehensive Business Assistance Fund to any person who in the discretion of the authority, demonstrates financial
need by either its inability to obtain conventional financial assistance in satisfactory
amounts or on satisfactory terms in accordance with the following provisions:
(1) The authority may make loans at the rate of interest to small contractors and
minority business enterprises for the purpose of financing labor and material costs only.
The aggregate outstanding amount of any loans made under this subdivision to any one
person, including affiliates, shall not exceed two hundred fifty thousand dollars. The
maximum term for repayment of any loan made under this subdivision shall not exceed
one year.
(2) The authority may make loans at the rate of interest to targeted businesses. The
aggregate outstanding amount of any loans made under this subdivision to any one
person, including affiliates, shall not exceed three hundred thousand dollars. The maximum term for repayment of any loan made under this subdivision shall not exceed (A)
twenty years for real property; (B) ten years for machinery and equipment; and (C)
seven years for working capital. For the purposes of this subdivision and subdivision
(3), working capital may include, but shall not be limited to, capital for expansion or
restructuring of a business.
(3) The authority may make loans at the rate of interest to impacted businesses. The
aggregate outstanding amount of any loans made under this subdivision to any one
person, including affiliates, shall not exceed five hundred thousand dollars, except the
authority, with the consent of the Secretary of the Office of Policy and Management,
may increase the maximum loan amount under this subdivision to one million dollars
if the authority in its discretion determines that the particular needs and conditions of
such impacted business warrant such increase. The maximum term for repayment of
any loan made under this subdivision shall not exceed (A) twenty years for real property;
(B) ten years for machinery and equipment; and (C) seven years for working capital.
(4) The authority may make loans at the rate of interest to water facilities. Such
loans shall be used for the planning, design, modification or construction of drinking
water facilities made necessary by the requirements of the Safe Water Act of 1974 or
by an order of the Department of Public Health, which drinking water facilities shall
include, but shall not be limited to, collection facilities, treatment facilities, wells, tanks,
mains, pumps, transmission facilities and any other machinery and equipment necessary
to meet the requirements of said act. Such loans shall also be used for the repair of dams
subject to the jurisdiction of the Department of Environmental Protection under chapter
446j. For the purposes of this subdivision, repair costs include, but shall not be limited to,
fees and expenses of architects, engineers, attorneys, accountants and other professional
consultants, and costs of preparing surveys, studies, site plans and specifications for
such repair. The aggregate outstanding amount of any loans made under this subdivision
to any water facility, including affiliates, shall not exceed two hundred fifty thousand
dollars. The maximum term for repayment of any loan made under this subdivision shall
not exceed (A) twenty years for real property; and (B) ten years for machinery and
equipment.
(5) The authority may make loans at zero per cent interest to municipal economic
development commissions established under section 7-136 or business outreach centers
described in section 32-9qq, that establish or participate in loan pools that lend funds
to (A) persons or groups of persons who complete entrepreneurial training programs
funded or approved by the Commissioner of Economic and Community Development
or (B) business support groups. As used in this subdivision, "business support group"
means a group of five or more persons, firms or corporations which plans to start or
expand separate businesses, has community or other ties demonstrating a common mission or purpose, agrees to undergo an entrepreneurial training program funded or approved by the commissioner, and each member of which agrees to provide business
support to other members of the group. The aggregate outstanding amount of any loans
made under this subdivision to any one person, group of persons or business support
group shall not exceed twenty-five thousand dollars. The maximum term for repayment
of any loan made under this subdivision shall not exceed ten years.
(6) The authority shall make loans at the rate of interest to entertainment or entertainment support service businesses located in the municipality with the pilot entertainment
district established pursuant to section 2 of public act 93-311*, and on and after July 1,
1995, may make loans at the rate of interest to entertainment or entertainment support
service businesses located in municipalities with entertainment districts designated under section 32-76.
(d) The state, acting through the authority, may make loans to state or local development corporations, for the purpose of providing funds to enable such state or local
development corporations to make loans to any person eligible for assistance under
subsection (c) hereof. The aggregate outstanding amount of any loan made under this
subsection to a state or local development corporation for a loan with respect to any one
project shall not exceed one million dollars.
(e) To carry out the purposes of this section, the authority shall have those powers
set forth in section 32-23e. The authority shall also have the power to take all reasonable
steps and exercise all available remedies necessary or desirable to protect the obligations
or interests of the authority including, but not limited to, the purchase or redemption on
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 payment may be made from the Comprehensive Business Assistance
Fund.
(f) The borrower shall pay such costs of processing applications for loans made
under this section, including closing costs, as the authority determines are reasonable
and necessary. The department may assist the authority in carrying out the provisions
of this section and any administrative expenses incurred by the department for services
provided to the authority or expenses incurred by the authority in carrying out the provisions of this section to the extent not paid by the borrower or from moneys appropriated to
the department or the authority for such purposes, may be paid from the Comprehensive
Business Assistance Fund.
(g) Each loan may be authorized by the authority or, if the authority so determines,
by a committee of the authority, one of whose members may be its executive director.
(h) Payments from the Comprehensive Business Assistance Fund to eligible borrowers or to pay administrative expenses shall be made upon certification by the executive director of the authority that payment is authorized under the provisions of this
section and under any applicable regulations or program criteria of the authority.
(i) For the purposes 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 seventeen million three hundred
fifty thousand dollars. The proceeds from the sale of said bonds shall be used by the
department to make grants to the authority for deposit in the Comprehensive Business
Assistance Fund for the purposes authorized under this section. The terms and conditions
of said grants shall be governed in accordance with a grant contract entered into between
the department and authority. All provisions of section 3-20 or the exercise of any right
or power granted thereby which are not inconsistent with the provisions of this section
are hereby adopted and shall apply to all bonds authorized by the State Bond Commission
pursuant to this section, and temporary notes in anticipation of the money to be derived
from the sale of any such bonds so authorized may be issued in accordance with said
section 3-20 and from time to time renewed. Said bonds shall mature at such time or
times not exceeding twenty years from their respective dates as may be provided in or
pursuant to the resolution or resolutions of the State Bond Commission authorizing such
bonds. None of such bonds shall be authorized except upon a finding by the State Bond
Commission that there has been filed with it a request for such authorization, which is
signed by or on behalf of the Secretary of the Office of Policy and Management and
states such terms and conditions as said commission in its discretion may require. Said
bonds issued pursuant to this section shall be general obligations of the state and the full
faith and credit of the state of Connecticut are pledged for the payment of the principal of
and interest on said bonds as the same become due, and accordingly and as part of the
contract of the state with the holders of said bonds, appropriation of all amounts necessary for punctual payment of such principal and interest is hereby made, and the Treasurer shall pay such principal and interest as the same become due. Net earnings on
any assets of the Comprehensive Business Assistance Fund, including investments or
reinvestments of proceeds, accrued interest and premiums on the issuance of such bonds,
after payment therefrom of expenses incurred by the Treasurer or State Bond Commission in connection with their issuance, shall become part of the Comprehensive Business
Assistance Fund.
(P.A. 88-265, S. 27, 36; P.A. 89-331, S. 23, 30; P.A. 90-297, S. 17, 24; June Sp. Sess. P.A. 91-4, S. 19, 25; P.A. 92-236, S. 41, 48; May Sp. Sess. P.A. 92-7, S. 21, 36; P.A. 93-311, S. 7, 8; 93-381, S. 9, 39; P.A. 94-247, S. 6, 8; May Sp.
Sess. P.A. 94-2, S. 199, 203; P.A. 95-250, S. 1; 95-257, S. 12, 21, 58; 95-272, S. 14, 29; P.A. 96-211, S. 1, 5, 6; 96-239,
S. 4, 17.)
*Note: Section 2 of public act 93-311 is special in nature and therefore has not been codified but remains in full force
and effect according to its terms.
History: P.A. 89-331 increased the bond authorization from $8,850,000 to $13,850,000; P.A. 90-297 increased the
bond authorization to $19,850,000; June Sp. Sess. P.A. 91-4 increased the bond authorization to $26,850,000; P.A. 92-236 added Subsec. (c)(5) re loans to fund persons or groups completing entrepreneurial training or business support groups;
May Sp. Sess. P.A. 92-7 amended Subsec. (i) to increase the bond authorization from $26,850,000 to $28,850,000; P.A.
93-311 amended Subsec. (b) and added Subsec. (c)(6) to extend eligibility for financial assistance to businesses located
in entertainment districts designated under Sec. 32-76 and Sec. 2 of P.A. 93-311, effective July 1, 1993; P.A. 93-381
replaced department of health services with department of public health and addiction services, effective July 1, 1993;
P.A. 94-247 amended Subsec. (b) to make businesses located in entertainment districts established under Sec. 2 of public
act 93-311 eligible for financial assistance, effective June 9, 1994; May Sp. Sess. P.A. 94-2 in Subsec. (i) decreased
bond authorization from $28,850,000 to $21,350,000, effective June 21, 1994; 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; P.A. 95-257 replaced Commissioner and Department of Public Health and Addiction Services with
Commissioner and Department of Public Health, effective July 1, 1995; P.A. 95-272 amended Subsec. (i) to reduce authorization from $21,350,000 to $17,350,000, effective July 1, 1995; P.A. 96-239 amended Subsec. (c)(2) by substituting
$300,000 for $250,000 as loan maximum amount, effective July 1, 1996.
See Sec. 32-477 re priority for applicants establishing work environments consistent with criteria in Sec. 32-475.