Bill Text: FL S1862 | 2011 | Regular Session | Introduced

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Bill Title: Economic Development

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2011-05-07 - Indefinitely postponed and withdrawn from consideration [S1862 Detail]

Download: Florida-2011-S1862-Introduced.html

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       Florida Senate - 2011                (Corrected Copy)    SB 1862
       
       
       
       By Senator Bennett
       
       
       
       
       21-01326A-11                                          20111862__
    1                        A bill to be entitled                      
    2         An act relating to economic development; creating s.
    3         288.9619, F.S.; creating the Business Loan Guarantee
    4         Program; defining terms; requiring the Office of
    5         Tourism, Trade, and Economic Development to create a
    6         business loan guarantee fund to provide loans to
    7         certain businesses; providing for use of certain funds
    8         for the program; providing maximum terms and amounts
    9         of loan guarantees; providing procedures for the
   10         approval of loan guarantee applications; requiring
   11         application fees; providing procedures for the payment
   12         of loan guarantees to cover investment losses;
   13         prohibiting disbursement of moneys for investment
   14         losses under certain circumstances; providing for use
   15         of loan repayments, interest earnings, and application
   16         fees; authorizing partnerships with financial
   17         institutions under certain circumstances; requiring
   18         the office to establish guidelines and performance
   19         measures for the program and criteria for the
   20         evaluation of funding applications; requiring the
   21         office to submit annual reports to the Governor and
   22         Legislature; providing for future repeal of the
   23         program; amending 288.1081, F.S.; revising provisions
   24         for the deposit of loan repayments from the Economic
   25         Gardening Business Loan Pilot Program; providing for
   26         use of the funds; repealing s. 288.9618, F.S.,
   27         relating to programs for the development of
   28         microenterprises; providing an effective date.
   29  
   30  Be It Enacted by the Legislature of the State of Florida:
   31  
   32         Section 1. Section 288.9619, Florida Statutes, is created
   33  to read:
   34         288.9619 Business Loan Guarantee Program.—
   35         (1) As used in this section, the term:
   36         (a) “Business” means any business incorporated under the
   37  laws of the state.
   38         (b) “Office” means the Office of Tourism, Trade, and
   39  Economic Development.
   40         (2) There is created within the office the Business Loan
   41  Guarantee Program. The office shall create a business loan
   42  guarantee fund in the state. The office may use funds deposited
   43  in the Economic Development Trust Fund from the Economic
   44  Gardening Business Loan Pilot Program under s. 288.1081(5)(e)
   45  for capitalizing the business loan guarantee fund. Where
   46  feasible, the office shall cooperate with other organizations
   47  active in the study and support of business loan assistance.
   48         (3)(a) The business loan guarantee fund may provide loan
   49  guarantees to offset a Florida-based mezzanine fund’s portion of
   50  risk that prevents the mezzanine fund from making an investment,
   51  either debt or equity, in a business that:
   52         1. Is a privately held, second-stage business;
   53         2. Has revenues of at least $5 million but not more than
   54  $75 million;
   55         3. Has earnings of at least $1 million before interest,
   56  taxes, depreciation, and amortization;
   57         4. Has a total debt-to-earnings ratio, before interest,
   58  taxes, depreciation, and amortization, of less than 3.0;
   59         5. Has proven and committed management teams;
   60         6. Has a competitive advantage in market segment or
   61  defensible niche position; and
   62         7. Has a sound historical financial performance.
   63         (b) Loan guarantees may be made:
   64         1. For terms of up to 36 months; and
   65         2. In amounts of up to 70 percent of a loan, not to exceed
   66  $500,000.
   67         (4) The office shall review and must approve or deny a
   68  Florida-based mezzanine fund’s loan guarantee application within
   69  30 days after receipt. The office shall impose upon each
   70  Florida-based mezzanine fund seeking a loan guarantee an
   71  application fee of 0.5 percent of the proposed loan guarantee.
   72  The office shall use the application fees to pay the
   73  administrative expenses of the program. If a Florida-based
   74  mezzanine fund experiences a loss on an investment for which a
   75  loan guarantee is provided under this section, the Florida-based
   76  mezzanine fund must submit to the office audited financial
   77  statements that demonstrate the investment’s actual tax loss
   78  experienced by the Florida-based mezzanine fund. The business
   79  loan guarantee fund may not disburse moneys for any losses
   80  experienced from a loan guarantee which exceed the moneys on
   81  deposit in the business loan guarantee fund. Any loan
   82  repayments, interest earnings, or unused application fees must
   83  be used by the office to capitalize the business loan guarantee
   84  fund for use as additional loan guarantees.
   85         (5) The office may partner with a financial institution if
   86  the financial institution agrees to place a meaningful amount of
   87  its own capital resources at risk in a loan guarantee that is
   88  part of a loan guarantee made by the office.
   89         (6) The office shall establish guidelines for administering
   90  the program and shall establish criteria for the competitive
   91  evaluation of applications for funding. The office shall
   92  establish performance measures for the program before providing
   93  grant moneys to any entity and shall report such measures and
   94  program outcomes annually to the Governor, the President of the
   95  Senate, and the Speaker of the House of Representatives.
   96  Performance measures shall include, but are not limited to, data
   97  on loan repayments and the status of the business receiving the
   98  loan during the loan term and for 2 years after repayment of the
   99  loan.
  100         (7) This section is repealed July 1, 2017, unless reviewed
  101  and reenacted by the Legislature before that date.
  102         Section 2. Paragraph (e) of subsection (5) of section
  103  288.1081, Florida Statutes, is amended to read:
  104         288.1081 Economic Gardening Business Loan Pilot Program.—
  105         (5)
  106         (e) A loan administrator, after collecting the servicing
  107  fee in accordance with paragraph (d), shall remit the borrower’s
  108  collected interest, principal payments, and charges for late
  109  payments to the office on a quarterly basis. If the borrower
  110  defaults on the loan, the loan administrator shall initiate
  111  collection efforts to seek repayment of the loan. The loan
  112  administrator, upon collecting payments for a defaulted loan,
  113  shall remit the payments to the office but, to the extent
  114  authorized in the grant agreement, may deduct the costs of the
  115  administrator’s collection efforts. The office shall deposit all
  116  funds received under this paragraph into the Economic
  117  Development Trust Fund for purposes of in the Business Loan
  118  Guarantee Program under s. 288.9619 General Revenue Fund.
  119         Section 3. Section 288.9618, Florida Statutes, is repealed.
  120         Section 4. This act shall take effect July 1, 2011.