Bill Text: HI SB706 | 2023 | Regular Session | Amended
Bill Title: Relating To Small Business Loans.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2023-02-06 - Report adopted; Passed Second Reading, as amended (SD 1) and referred to WAM. [SB706 Detail]
Download: Hawaii-2023-SB706-Amended.html
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THE SENATE |
S.B. NO. |
706 |
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THIRTY-SECOND LEGISLATURE, 2023 |
S.D. 1 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO SMALL BUSINESS LOANS.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
"Chapter
HAWAII start-up business loan program
§ -1 Definitions. As used in this chapter:
"Department" means the department of business, economic development, and tourism.
"Division" means the business development and support division of the department of business, economic development, and tourism.
"Financial institution" means any organization authorized to do business under state or federal laws relating to financial institutions, including without limitation, banks, savings banks, savings and loan companies or associations, financial services loan companies, and credit unions.
"Program" means the Hawaii start-up business loan program.
"Start-up business" means a business that:
(1) Is registered in the State;
(2) Has been in business for three years or less; and
(3) Fulfills the qualifications established by the division to receive a start-up business loan under this chapter.
§ -2 Hawaii start-up business loan program. There is established a Hawaii start-up business loan program that shall be administered by the division in coordination with the Hawaii technology development corporation.
§ -3 Functions, powers, and duties of the division. In the performance of, and with respect to, the functions, powers, and duties vested in the division by this chapter, the division may:
(1) Prescribe rules and regulations to carry out this chapter; and
(2) Perform all functions necessary to effectuate the purposes of this chapter.
§ -4 Rules and regulations. The rules and regulations shall:
(1) Prescribe the qualifications for eligibility of applicants for loans;
(2) Establish preferences and priorities in determining eligibility for loans;
(3) Establish the conditions, consistent with the purposes of this chapter, for the granting or for the continuance of a grant of a loan; and
(4) Provide for inspection, at reasonable hours, of the plant, books, and records of an enterprise that has applied for or has been granted a loan, and to require the submission of progress and final reports.
§ -5 Direct loans, terms, and restrictions. (a) The division may make loans to start-up business concerns for the financing of working capital, construction or improvement of facilities, and equipment. The loans shall not be made in conjunction with any loans made or grants awarded by the division. Where the loans made by the division are secured, the security may be subordinated to the loans made by other financial institutions; provided that the subordination is required to obtain loans from those institutions. The necessity for and the extent of security required in any loan shall be determined by the division.
(b) The foregoing powers shall be subject to the following restrictions and limitations:
(1) No loan shall be granted unless financial assistance is not available to the applicant; provided that the condition may be waived by the division for participation loans or loan guarantees with a private financial institution;
(2) The amount of the loan shall not exceed a total of $10,000;
(3) No loan shall be made for a term exceeding six years;
(4) Each loan shall bear simple interest at a rate of four per cent per year; and
(5) The payment of interest on the principal of a loan may be deferred by the division, but in no event shall interest payments be deferred in excess of twenty-four months from the date of issuance of the loan.
(c) The division may contract with any financial institution for services, including servicing or administering loans pursuant to this section.
§ -6 Hawaii start-up business loan program special fund. (a) There is established in the state treasury the Hawaii start-up business loan program special fund, into which shall be deposited appropriations made by the legislature to the fund.
(b) Moneys in the Hawaii start-up business loan program special fund shall be administered by the department and shall be used for providing loans to start-up businesses.
(c) All unexpected and unencumbered moneys remaining in the Hawaii start-up business loan program special fund at the close of each fiscal year shall not lapse to the credit of the state general fund.
(d) The department may contract with any financial institution for services including the day-to-day management of the fund pursuant to this section.
§ -7 Reports. The department shall submit a report to the legislature on the division's activities in administering the loan program no later than twenty days prior to the convening of each regular session beginning with the regular session of 2024. The report shall include:
(1) A description and uses of the loan program;
(2) A summary of information and analytical data concerning the implementation of the loan program; and
(3) Repayments made."
SECTION 2. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2023-2024 and the same sum or so much thereof as may be necessary for fiscal year 2024-2025 to be deposited into the Hawaii start-up business loan program special fund.
The sums appropriated shall be expended by the department of business, economic development, and tourism for the purposes of this Act.
SECTION 3. There is appropriated out of the Hawaii start-up business loan program special fund the
sum of $ or so much
thereof as may be necessary for fiscal year 2023-2024 and the same sum or so
much thereof as may be necessary for fiscal year 2024-2025 for the purpose of
implementing the Hawaii start-up business loan program and to provide loans
under the program.
The
sums appropriated shall be expended by the department of business, economic
development, and tourism for the purposes of this Act.
SECTION 4. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2023-2024 and the same sum or so much thereof as may be necessary for fiscal year 2024-2025 to fund one full-time equivalent (1.0 FTE) loan officer position within the business support branch of the department of business, economic development, and tourism.
The sums appropriated shall be expended by the department of business, economic development, and tourism for the purposes of this Act.
SECTION 5. If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.
SECTION 6. This Act shall take effect on January 6, 2050.
Report Title:
Hawaii Start-Up Business Loan Program; Hawaii Start-Up Business Loan Program Special Fund; Department of Business, Economic Development, and Tourism; Hawaii Technology Development Corporation; Appropriation
Description:
Creates the Hawaii Start-Up Business Loan Program to be administered by the Business Development and Support Division of the Department of Business, Economic Development, and Tourism, in coordination with the Hawaii Technology Development Corporation. Establishes the Hawaii Start-Up Business Loan Program Special Fund. Makes an appropriation. Effective January 6, 2050. (SD1)
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
