Bill Text: NY S02296 | 2019-2020 | General Assembly | Amended

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Bill Title: Allows businesses to use funds received from the minority- and women-owned business development and lending program for the purpose of refinancing existing debt.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Engrossed - Dead) 2020-03-04 - referred to economic development [S02296 Detail]

Download: New_York-2019-S02296-Amended.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                         2296--A

                               2019-2020 Regular Sessions

                    IN SENATE

                                    January 23, 2019
                                       ___________

        Introduced  by  Sen. SANDERS -- read twice and ordered printed, and when
          printed to be committed to the Committee on Corporations,  Authorities
          and   Commissions  --  committee  discharged,  bill  amended,  ordered
          reprinted as amended and recommitted to said committee

        AN ACT to amend the urban development corporation act,  in  relation  to
          allowing  businesses  to  use  funds  received  from  the minority and
          women-owned business development and lending program for  the  purpose
          of refinancing existing debt

          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:

     1    Section 1. Subparagraph (vii) of paragraph (c)  of  subdivision  1  of
     2  section 16-c of section 1 of chapter 174 of the laws of 1968, constitut-
     3  ing  the  urban  development corporation act, as amended by section 1 of
     4  part AA of chapter 55 of the  laws  of  2014,  is  amended  to  read  as
     5  follows:
     6    (vii)  refinancing  of  debt  or  equity  invested in an enterprise or
     7  project, unless the chairperson of the corporation finds  the  terms  of
     8  the original debt to be unreasonable as provided in subparagraph (ix) of
     9  paragraph (d) of this subdivision.
    10    §  2. Subparagraphs (vii) and (viii) of paragraph (d) of subdivision 1
    11  of section 16-c of section 1 of chapter 174 of the laws of 1968, consti-
    12  tuting the urban development  corporation  act,  subparagraph  (vii)  as
    13  amended  and  subparagraph  (viii)  as  added by section 1 of part AA of
    14  chapter 55 of the laws of 2014, are amended and a new subparagraph  (ix)
    15  is added to read as follows:
    16    (vii)  establish a comprehensive technical assistance program in coop-
    17  eration with the department of economic development to assist  minority-
    18  and  women-owned  businesses and potential minority and women-entrepren-
    19  eurs; [and]
    20    (viii) notwithstanding any provision of law to the contrary, establish
    21  a minority- and women-owned business investment fund to provide critical

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD00792-02-9
        S. 2296--A                          2

     1  financial support to foster the development of new  and  emerging  ideas
     2  and  products  of minority- and women-owned business enterprises as well
     3  as to promote the long-term financial performance and success  of  early
     4  stage  enterprises  that  are  minority-  and women-owned start-ups. The
     5  selection of an eligible applicant and  beneficiary  companies  for  the
     6  minority-  and women-owned business investment fund shall be selected by
     7  the process established pursuant to subdivisions  two  through  four  of
     8  section  sixteen-u of this act. Minority- or women-owned business enter-
     9  prises who  participate  in  such  minority-  and  women-owned  business
    10  investment fund under this subdivision shall not be precluded from qual-
    11  ifying  for  any other assistance, grant or loan made available from the
    12  state[.]; and
    13    (ix) provide for the refinancing of debt  or  equity  invested  in  an
    14  enterprise  or project, provided that the chairperson of the corporation
    15  determines the terms of the original debt to be unreasonable. The appli-
    16  cant must submit a written  justification  to  the  chairperson  of  the
    17  corporation  for  each  loan  explaining  why the current loan is not on
    18  reasonable terms. Unreasonable terms of debt may  include  but  are  not
    19  limited to:
    20    (1) a demand or balloon maturity feature in the existing note;
    21    (2)  the  current maturity is not appropriate for the original purpose
    22  of the loan;
    23    (3) the existing debt being refinanced is on a  revolving  line  or  a
    24  credit card;
    25    (4) the interest rate is deemed unreasonable by the corporation; or
    26    (5) the loan is over-collateralized.
    27    §  3.  This  act shall take effect on the ninetieth day after it shall
    28  have become a law. Effective immediately, the addition, amendment and/or
    29  repeal of any rule or regulation necessary  for  the  implementation  of
    30  this  act  on  its effective date are authorized and directed to be made
    31  and completed on or before such effective date.