Bill Text: NY S08094 | 2023-2024 | General Assembly | Introduced

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Bill Title: Relates to the capital access program; focuses on minority and women-owned business enterprises and small businesses located in highly distressed areas to assist them in processing and being approved for qualifying program loans; requires the engagement in outreach and marketing to financial institutions to increase awareness of the program.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2024-01-31 - SUBSTITUTED BY A8537 [S08094 Detail]

Download: New_York-2023-S08094-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                          8094

                    IN SENATE

                                     January 5, 2024
                                       ___________

        Introduced  by  Sen. SANDERS -- read twice and ordered printed, and when
          printed to be committed to the Committee on Rules

        AN ACT to amend the banking law and the New York state urban development
          corporation act, in relation to the capital access program

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

     1    Section  1. Paragraph (b) of subdivision 1 of section 212 of the bank-
     2  ing law, as amended by a chapter of the laws of 2023 amending the  bank-
     3  ing  law and the New York state urban development corporation act relat-
     4  ing to the capital access program,  as  proposed  in  legislative  bills
     5  numbers S. 1690-A and A. 6716-A, is amended to read as follows:
     6    (b) The corporation shall undertake the following programs in further-
     7  ance  of  the  above  objectives:  (i)  establish  regional  offices  at
     8  locations throughout New  York,  with  sufficient  staffing  to  advise,
     9  develop  and  package  financial  assistance  for small and medium sized
    10  businesses; (ii) develop a comprehensive outreach  program  to  increase
    11  the  visibility  and  awareness of the corporation's programs, including
    12  allocating budget and staff to establish and maintain an aggressive  and
    13  extensive  marketing  program of the corporation's program of assistance
    14  to small and medium sized businesses, providing for specific outreach to
    15  minority and [women owned] women-owned enterprises,  and  entering  into
    16  cooperative  relationships with local chambers of commerce, local devel-
    17  opment agencies, local  development  corporations  and  other  community
    18  based financial intermediaries as set forth in subdivision three of this
    19  section; (iii) establish and operate, or affiliate with a small business
    20  investment  company and a specialized small business investment company;
    21  (iv) establish a pilot export financing program,  using  personnel  from
    22  the  private  sector,  to  evaluate  whether  the corporation can play a
    23  significant role in the growth of the export industry in the  state  and
    24  (v) establish a program in cooperation with the empire state development
    25  corporation  that  shall  focus  on  small  businesses located in highly
    26  distressed areas  and  minority  and  women-owned  business  enterprises
    27  (MWBEs) as such designations are defined by [the regulations of] the New
    28  York  state  urban development corporation act, through which the corpo-

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD05985-04-4
        S. 8094                             2

     1  ration shall be authorized to:   (A) act as third-party  agent  for  the
     2  capital  access  program established by section sixteen-k of section one
     3  of chapter one hundred seventy-four of  the  laws  of  nineteen  hundred
     4  sixty-eight,  constituting  the  urban  development corporation act; (B)
     5  process, fund and approve qualifying program loans made  by  the  corpo-
     6  ration  or  a  participating  financial  institution pursuant to section
     7  sixteen-k of section one of chapter one hundred seventy-four of the laws
     8  of nineteen hundred  sixty-eight,  constituting  the  urban  development
     9  corporation  act;  (C)  maintain  and  service a portfolio of qualifying
    10  loans made pursuant to the capital access program;  and  (D)  engage  in
    11  outreach  and  marketing to financial institutions to increase awareness
    12  of the program established  under  this  subparagraph.  The  corporation
    13  shall  undertake  the  programs  enumerated  herein at such times as its
    14  board of directors determines that the corporation's  capital  base  and
    15  available  funds  are adequate to support the operation of such program.
    16  The programs enumerated herein may be modified by the corporation as may
    17  be necessary to meet the changing  needs  of  the  state's  economy,  as
    18  determined by the board of directors.
    19    §  2.  Paragraph  (b) of subdivision 3 of section 16-k of section 1 of
    20  chapter 174 of the laws of 1968, constituting the New York  state  urban
    21  development corporation act, as amended by a chapter of the laws of 2023
    22  amending the banking law and the New York state urban development corpo-
    23  ration act relating to the capital access program, as proposed in legis-
    24  lative  bills  numbers  S.  1690-A  and A. 6716-A, is amended to read as
    25  follows:
    26    (b) Any contract entered into pursuant to subparagraph  (i)  of  para-
    27  graph (a) of this subdivision shall:
    28    (i)  be  for  a  period of two years and shall be renewed for an addi-
    29  tional two year period subject to requirements of subparagraph  (ii)  of
    30  paragraph (a) of this subdivision;
    31    (ii) provide for compensation for expenses incurred by the third party
    32  agent  in  connection  with  its  services  as  agent and for such other
    33  services as the New  York  business  development  corporation  may  deem
    34  appropriate  including,  but  not  limited  to  the use of the premises,
    35  personnel and personal property of the third party agent; and
    36    (iii) notwithstanding any law, rule or regulation to the contrary, use
    37  the guidelines, related to, but not limited  to  underwriting  standards
    38  provided  for  in  subdivision four of this section to evaluate applica-
    39  tions for loans pursuant to the program filed by a minority  and  women-
    40  owned business [enterprise] enterprises, or a small business whose prin-
    41  cipal place of business is in a highly distressed area[;
    42    (iv)  provide  for the development of an integrated web portal for the
    43  third-party agent which enables access by minority and women-owned busi-
    44  ness enterprises and small businesses  in  highly  distressed  areas  to
    45  obtain  information  on  the  capital  access loan program including the
    46  ability to make application  and  to  receive  approval  for  such  loan
    47  online; and
    48    (v)  provide  funding  for  marketing  to  the third-party agent to be
    49  directed to potential loan recipients and to financial  institutions  to
    50  increase  awareness  participation  and  referrals to the capital access
    51  loan program].
    52    § 3. Subdivision 3 of section 16-k of section 1 of chapter 174 of  the
    53  laws  of  1968, constituting the New York state urban development corpo-
    54  ration act, is amended by adding a new paragraph (c) to read as follows:
    55    (c) The corporation, and any third party it contracts with pursuant to
    56  paragraph (a) of this subdivision,  shall  collaborate,  to  the  extent
        S. 8094                             3

     1  practicable,  to increase minority and women-owned businesses' and small
     2  businesses' whose principal place of business is in a highly  distressed
     3  area,  awareness  of,  participation  in,  and  referrals to the capital
     4  access loan program.
     5    §  4. Subdivision 4 of section 16-k of section 1 of chapter 174 of the
     6  laws of 1968, constituting the New York state urban  development  corpo-
     7  ration act, as added by a chapter of the laws of 2023 amending the bank-
     8  ing  law and the New York state urban development corporation act relat-
     9  ing to the capital access program,  as  proposed  in  legislative  bills
    10  numbers S. 1690-A and A. 6716-A, is amended to read as follows:
    11    4.  Notwithstanding  any  law, rule or regulation to the contrary, the
    12  department of financial services, the empire  state  development  corpo-
    13  ration  and  the New York business development corporation, in consulta-
    14  tion with relevant stakeholders, shall jointly  establish  [underwriting
    15  standards]  guidelines  relating  to,  but  not limited to, underwriting
    16  standards to assist minority and women-owned  business  enterprises  and
    17  small businesses in highly distressed areas in accessing and participat-
    18  ing  in  the  capital access program. In addition to other factors, such
    19  [standards] guidelines should incorporate verifiable  alternative  indi-
    20  cations  and best practices of creditworthiness presented or made avail-
    21  able by the applicant.
    22    § 5. This act shall take effect on the  same  date  and  in  the  same
    23  manner as a chapter of the laws of 2023 amending the banking law and the
    24  New York state urban development corporation act relating to the capital
    25  access  program,  as proposed in legislative bills numbers S. 1690-A and
    26  A.  6716-A, takes effect.