Bill Text: OH HB44 | 2011-2012 | 129th General Assembly | Introduced

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Bill Title: To create the Small Business Working Capital Loan Program.

Spectrum: Partisan Bill (Democrat 18-0)

Status: (Introduced - Dead) 2011-01-20 - To Economic & Small Business Development [HB44 Detail]

Download: Ohio-2011-HB44-Introduced.html

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As Introduced

129th General Assembly Regular Session 2011-2012

H. B. No. 44

Representatives Goyal, Garland 

Cosponsors: Representatives Driehaus, Szollosi, Murray, Pillich, Stinziano, O'Brien, Reece, Williams, Patmon, Yuko, Lundy, Boyd, Slesnick, Phillips, Weddington, Heard 

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A BILL

To enact sections 166.45 to 166.51 of the Revised

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Code to create the Small Business Working Capital

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Loan Program.

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BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1.  That sections 166.45, 166.46, 166.47, 166.48,	4
166.49, 166.50, and 166.51 of the Revised Code be enacted to read	5
as follows:	6

Sec. 166.45.  As used in sections 166.45 to 166.50 of the	7
Revised Code:	8

(A) "EDGE business enterprise" has the same meaning as in	9
section 123.152 of the Revised Code.	10

(B) "Eligible business" means any person that has all of the	11
following characteristics:	12

(1) Is headquartered in this state;

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(2) Is organized for profit;

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(3) Had total annual sales in its most recently completed	15
fiscal year of not more than fifty million dollars.	16

(C) "Minority business enterprise" has the same meaning as in	17
section 122.71 of the Revised Code.	18

(D) "Participating lending institution" means a financial	19
institution that is eligible to make commercial loans, is an	20
eligible public depository of state funds under section 135.03 of	21
the Revised Code, and agrees to participate in the small business	22
working capital loan program.	23

(E) "Women's business enterprise" has the same meaning as in	24
section 150.051 of the Revised Code.	25

Sec. 166.46. There is hereby created in the department of	26
development the small business working capital loan program to	27
provide a statewide availability of funds for lending purposes	28
that will inject needed capital into the business community in	29
order to create or preserve jobs in this state.	30

Sec. 166.47. (A) Upon the request of the director of	31
development, the treasurer of state may invest up to one hundred	32
million dollars of public money of the state with participating	33
lending institutions for purposes of the small business working	34
capital loan program. Each such institution shall enter into an	35
agreement with the department of development that sets out the	36
terms and conditions under which the institution is to participate	37
in the program. As part of that agreement, the state may forego	38
any accrued interest owed on the amount invested with an	39
institution if the director determines it will provide small	40
businesses the access to credit they need to create or preserve	41
jobs in this state.	42

(B) Participating lending institutions shall comply fully	43
with Chapter 135. of the Revised Code.	44

(C) The amount invested with a participating lending	45
institution for purposes of the program remains the property of	46
the state.	47

Sec. 166.48. (A) The director of development shall select, as	48
administrators of the small business working capital loan program,	49
not more than two private, for-profit Ohio-based investment firms	50
to accept, review, and approve applications for loans from	51
eligible businesses and to otherwise administer the program. The	52
director shall select program administrators only after soliciting	53
and evaluating requests for proposals as prescribed in this	54
section.	55

(B) The department of development shall publish a notice of a	56
request for proposals in newspapers of general circulation in this	57
state once each week for two consecutive weeks before a date	58
specified by the department as the date on which the department	59
will begin accepting proposals. The notices shall contain a	60
general description of the subject of the proposed agreement and	61
the location where the request for proposals may be obtained. The	62
request for proposals shall include all of the following:	63

(1) Instructions and information to respondents concerning	64
the submission of proposals, including the name and address of the	65
office where proposals are to be submitted;	66

(2) Instructions regarding the manner in which respondents	67
may communicate with the department, including the names, titles,	68
and telephone numbers of the individuals to whom such	69
communications should be directed;	70

(3) The factors and criteria to be considered in evaluating	71
respondents' proposals, the relative importance of each factor or	72
criterion, and a description of the department's evaluation	73
procedure;	74

(4) The amount of compensation a program administrator will	75
receive, if any.	76

(C) After the date specified for receiving proposals, the	77
department shall evaluate the submitted proposals. The department	78
may discuss a respondent's proposal with that respondent to	79
clarify or revise a proposal or the terms of the agreement.	80

The department shall choose for review proposals from at	81
least three respondents the department considers qualified to	82
administer the program. If three or fewer proposals are submitted,	83
the department shall review each proposal. The department may	84
cancel a request for proposals at any time before entering into an	85
agreement with a respondent.	86

After reviewing the chosen proposals, the director may select	87
not more than two such respondents and enter into a written	88
agreement with each of them.	89

(D) Selecting a program administrator and entering into an	90
agreement under this section do not constitute a purchase of	91
services under Chapter 125. of the Revised Code.	92

Sec. 166.49.  (A) The program administrators selected under	93
section 166.48 of the Revised Code shall accept and review	94
applications for working capital loans from eligible businesses.	95
Only those eligible businesses that meet the criteria established	96
by the director of development under section 166.50 of the Revised	97
Code may be approved for a working capital loan.	98

(B) Upon the approval of a loan application, the program	99
administrators shall submit all necessary information to a	100
participating lending institution at which the treasurer of state	101
has invested public money of the state for purposes of the small	102
business working capital loan program. That information shall	103
include the amount and terms of the loan and any other information	104
determined by the director. A program administrator may commit its	105
own capital as part of the aggregate amount loaned to an eligible	106
business under the program.	107

(C) The program administrators shall be responsible for	108
monitoring compliance with all loan-related documents, as well as	109
documenting the manner in which loan recipients are using the	110
working capital loan funds. The program administrators shall	111
submit monthly reports to the director that cover the total number	112
of loans made under the program and the number that are in	113
default; the number of loans made to minority business	114
enterprises, women's business enterprises, and EDGE business	115
enterprises; the progress made by the program in meeting the goal	116
established by the director under division (C) of section 166.50	117
of the Revised Code; how the loan funds are being used; the number	118
of jobs created or preserved in this state as a result of the	119
loans; the overall progress of the program; and any other	120
information determined by the director.	121

Sec. 166.50.  In order to implement the small business	122
working capital loan program, the director of development shall do	123
all of the following:	124

(A) Establish the criteria that must be met by an eligible	125
business in order to receive a loan under the program. In	126
determining those criteria, priority shall be given to the	127
economic needs of the area in which the business is located, the	128
number of jobs to be created or preserved in this state by the	129
receipt of a loan, and such other factors related to the overall	130
economic welfare of the state as the director considers	131
appropriate to determine the relative financial need of the	132
eligible business. The director shall also establish the minimum	133
and maximum amounts that may be loaned to, and the maximum credit	134
risk of, eligible businesses under the program.	135

(B) Prescribe the loan application form to be used by	136
eligible businesses for purposes of the program. On the loan	137
application an eligible business shall be required to certify that	138
the loan will be used to create new jobs or preserve existing jobs	139
and employment opportunities in this state and to acquire tangible	140
personal property to be used in the business. Whoever knowingly	141
makes a false statement concerning such application is guilty of	142
the offense of falsification under section 2921.13 of the Revised	143
Code.	144

(C) Establish a goal for lending to eligible businesses that	145
are minority business enterprises, women's business enterprises,	146
or EDGE business enterprises. The goal shall be in the form of a	147
specified percentage of the total amount of money the state	148
invests with participating lending institutions for purposes of	149
the program.	150

(D) Establish the terms under which a program administrator	151
may commit its own capital as part of a working capital loan.	152

Sec. 166.51. The director of development may use, as part of	153
the small business working capital loan program, any federal money	154
made available to the state for the purpose of providing working	155
capital assistance to small businesses. In the event the federal	156
money is required by the federal government to be used in a manner	157
other than as prescribed by sections 166.45 to 166.50 of the	158
Revised Code, the director of development may modify the small	159
business working capital loan program set forth in those sections	160
in order to meet the federal guidelines.	161