Sec. 32-9q. Loans for business expansion in a distressed municipality. Loans to nonprofit state or local development corporations. Transfer of certain funds to the Connecticut Growth Fund.
Sec. 32-9q. Loans for business expansion in a distressed municipality. Loans
to nonprofit state or local development corporations. Transfer of certain funds to
the Connecticut Growth Fund. (a) An Employment Incentive Revolving Fund is
hereby created. In order to encourage business expansion and location in distressed
municipalities, the state, acting through the Department of Economic and Community
Development may make working capital loans to any industrial business organization
in a distressed municipality which has or is reasonably expected to create new employment in the municipality. The business organization will be considered to have created
new employment in such municipality if the number of persons employed by such business organization as a result of such loan has increased or is expected to increase by
more than five. Working capital loans under this section shall not exceed seventy-five
thousand dollars in amount nor ten years in term for any single loan and shall not be
made unless the borrower receives concurrently with such loan another working capital
loan from a private financial institution or local development corporation, as defined in
Sections 501, 502 and 503 of the Small Business Investment Act, Public Law 699, as
amended, in an amount at least equal to the amount of the working capital loan made
by the state. Such working capital loans made by the state or by a private financial
institution may be either secured or unsecured. Any business organization receiving a
working capital loan from the state under this section shall demonstrate to the satisfaction
of the Commissioner of Economic and Community Development that the availability
of such loan was an important factor in the decision of such business organization to
locate or expand in such distressed municipality.
(b) The state, acting through the Commissioner of Economic and Community Development, may make loans under this section to any nonprofit state or local development corporation. The purposes of such loans shall include, but not be limited to, working
capital, start-ups and fixed assets. Such loans shall not exceed in the aggregate five
hundred thousand dollars.
(c) The Commissioner of Economic and Community Development shall charge and
collect interest on each loan extended by the state under this section at a rate not in
excess of one per cent above the rate of interest borne by the bonds of the state last
issued prior to the date such loan is made. Payments of principal and interest on such
loans paid to the Treasurer for deposit in the Employment Incentive Revolving Fund
shall be transferred to the Connecticut Growth Fund established under section 32-23v.
(d) The Commissioner of Economic and Community Development shall adopt regulations in accordance with chapter 54 to carry out the provisions of this section. Such
regulations shall establish loan procedures, repayment terms, security requirements,
default and remedy provisions and such other terms and conditions as said commissioner
shall deem appropriate.
(e) For the purposes of this section the State Bond Commission shall have 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 five hundred thousand dollars.
All provisions of section 3-20 and the exercise of any right or power granted thereby
which is 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. Temporary notes in anticipation of the money to be derived from the sale of
any bonds so authorized may be issued in accordance with said section 3-20 and from
time to time renewed. Such 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 said 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 the Secretary of
the Office of Policy and Management or by or on behalf of such state officer, department
or agency and stating such terms and conditions as said commission, in its discretion,
may require. 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. 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.
(P.A. 78-357, S. 2, 5, 16; P.A. 79-521; P.A. 82-434, S. 5, 6; P.A. 83-580, S. 4, 8; P.A. 86-107, S. 6, 19; P.A. 88-265,
S. 33, 36; P.A. 95-250, S. 1; P.A. 96-211, S. 1, 5, 6.)
History: P.A. 79-521 inserted new Subsec. (b) re loans to nonprofit state or local development corporations, relettering
former Subsecs. (b) to (d) accordingly and deleted "working capital" where referring to loans under Subsec. (c), formerly
(b); P.A. 82-434 amended Subsec. (a) to delete the necessity of a physical expansion in order to be eligible for a loan; P.A.
83-580 provided for the transfer of outstanding assets and liabilities of fund to the small contractors and manufacturers
revolving loan fund in Subsec. (c) and reduced bond authorization in Subsec. (e) from $1,00,000 to $500,000; P.A. 86-107 removed reference to the state treasurer as trustee of the fund; P.A. 88-265 substituted Connecticut growth fund for small
contractors and manufacturers revolving loan fund in Subsec. (c); 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.