CS/HB 5201A

1
A bill to be entitled
2An act relating to economic development; creating s.
3288.1081, F.S.; creating the Economic Gardening Business
4Loan Pilot Program within the Office of Tourism, Trade,
5and Economic Development; providing legislative findings
6and intent; providing a finding of paramount public
7purpose; providing eligibility criteria for the award of
8loans to certain businesses; providing application
9procedures; requiring loan agreements; providing terms of
10loans; providing for use of loan proceeds; requiring
11charges for late payments; providing criteria and
12application procedures for selection of loan
13administrators; requiring a loan administrator to enter
14into a grant agreement; providing for the disbursement of
15certain funds from the Economic Development Trust Fund;
16requiring fees for the loan administrator; providing for
17the collection and deposit of loan payments; requiring the
18loan administrator to submit a report to the office;
19requiring the office to adopt rules; authorizing the use
20of emergency rulemaking procedures; requiring the office
21to submit a report to the Governor and Legislature;
22providing for reversion and carryforward of certain
23unexpended appropriations; prohibiting new loans after a
24specified date; providing for future repeal; creating s.
25288.1082, F.S.; creating the Economic Gardening Technical
26Assistance Pilot Program within the office; requiring the
27office to contract for administration of the pilot
28program; requiring competitive procurement; requiring the
29provision of technical assistance to certain businesses;
30providing eligibility criteria for businesses to receive
31technical assistance; requiring the businesses to enter
32into agreements with the contracted entity administering
33the pilot program; requiring the businesses to report
34certain data; providing that a contracted entity is an
35economic development agency under certain provisions
36relating to confidentiality of records; providing for
37review of contracts; requiring the office to submit a
38report to the Governor and Legislature; authorizing the
39office to adopt rules; directing the Office of Program
40Policy Analysis and Government Accountability to submit a
41report to the Governor and Legislature; authorizing the
42expenditure of certain funds appropriated for the pilot
43program; providing an effective date.
44
45Be It Enacted by the Legislature of the State of Florida:
46
47     Section 1.  Section 288.1081, Florida Statutes, is created
48to read:
49     288.1081  Economic Gardening Business Loan Pilot Program.--
50     (1)  There is created within the Office of Tourism, Trade,
51and Economic Development the Economic Gardening Business Loan
52Pilot Program. The purpose of the pilot program is to stimulate
53investment in Florida's economy by providing loans to expanding
54businesses in the state. As used in this section, the term
55"office" means the Office of Tourism, Trade, and Economic
56Development.
57     (2)  The Legislature finds that it is vital to the overall
58health and growth of the state's economy to promote favorable
59conditions for expanding Florida businesses that demonstrate the
60ability to grow. The Legislature further finds that, due to the
61current extraordinary economic challenges confronting the state,
62there exists a paramount public purpose in expending state
63resources to stimulate investment in Florida's economy. It is
64therefore the intent of the Legislature that resources be
65provided for the pilot program.
66     (3)(a)  To be eligible for a loan under the pilot program,
67an applicant must be a business eligible for assistance under
68the Economic Gardening Technical Assistance Pilot Program as
69provided in s. 288.1082(4)(a).
70     (b)  A loan applicant must submit a written application to
71the loan administrator in the format prescribed by the loan
72administrator. The application must include:
73     1.  The applicant's federal employer identification number,
74unemployment account number, and sales or other tax registration
75number.
76     2.  The street address of the applicant's principal place
77of business in this state.
78     3.  A description of the type of economic activity,
79product, or research and development undertaken by the
80applicant, including the six-digit North American Industry
81Classification System code for each type of economic activity
82conducted by the applicant.
83     4.  The applicant's annual revenue, number of employees,
84number of full-time equivalent employees, and other information
85necessary to verify the applicant's eligibility for the pilot
86program under s. 288.1082(4)(a).
87     5.  The projected investment in the business, if any, that
88the applicant proposes in conjunction with the loan.
89     6.  The total investment in the business from all sources,
90if any, that the applicant proposes in conjunction with the
91loan.
92     7.  The number of net new full-time equivalent jobs that,
93as a result of the loan, the applicant proposes to create in
94this state as of December 31 of each year and the average annual
95wage of the proposed jobs.
96     8.  The total number of full-time equivalent employees the
97applicant currently employs in this state.
98     9.  The date that the applicant anticipates it needs the
99loan.
100     10.  A detailed explanation of why the loan is needed to
101assist the applicant in expanding jobs in the state.
102     11.  A statement that all of the applicant's available
103corporate assets are pledged as collateral for the amount of the
104loan.
105     12.  A statement that the applicant, upon receiving the
106loan, agrees not to seek additional long-term debt without prior
107approval of the loan administrator.
108     13.  A statement that the loan is a joint obligation of the
109business and of each person who owns at least 20 percent of the
110business.
111     14.  Any additional information requested by the office or
112the loan administrator.
113     (c)  The loan administrator, after verifying the accuracy
114of a submitted application, shall award the loan to the
115applicant if the administrator determines that the applicant, as
116compared to other applicants submitting applications, is in the
117best position to use the loan to continue making a successful
118long-term business commitment to the state.
119     (d)  A borrower awarded a loan under this section and the
120loan administrator must enter into a loan agreement that
121provides for the borrower's repayment of the loan.
122     (4)  The following terms apply to a loan received under the
123pilot program:
124     (a)  The maximum amount of the loan is $250,000.
125     (b)  The proceeds of the loan may be used only for working
126capital purchases, employee training, or salaries for newly
127created jobs in the state.
128     (c)  The security interest for the loan's collateral must
129pledge all of the borrower's available corporate assets to cover
130the amount of the loan and must be perfected by recording a lien
131under the Uniform Commercial Code.
132     (d)  The period of the loan may not exceed 7 years.
133     (e)  The interest rate of the loan is 2 percent. However,
134if the borrower does not create the projected number of jobs
135within 24 months after the loan is issued, the interest rate
136shall be increased for the remaining period of the loan to the
137prime rate published in the Wall Street Journal, as of the date
138specified in the loan agreement, plus 4 percent.
139     (f)  For each month of the first 12 months of the loan,
140payment is due for interest only. Thereafter, payment for
141interest and principal is due each month until the loan is
142repaid in full. Interest and principal payments are based on the
143unpaid balance of the total loan amount.
144     (g)  The borrower must remit payments to the loan
145administrator within the first 10 days of each month. The loan
146administrator shall charge the borrower a penalty for late
147payments, and the amount of the penalty must be specified in the
148loan agreement.
149     (5)(a)  The office may designate one or more qualified
150entities to serve as loan administrators for the pilot program.
151A loan administrator must:
152     1.  Be a Florida corporation not for profit incorporated
153under chapter 617 that has its principal place of business in
154the state.
155     2.  Have 5 years of verifiable experience of lending to
156businesses in this state.
157     3.  Submit an application to the office on forms prescribed
158by the office. The application must include the loan
159administrator's business plan for its proposed lending
160activities under the pilot program, including, but not limited
161to, a description of its outreach efforts, underwriting, credit
162policies and procedures, credit decision processes, monitoring
163policies and procedures, and collection practices; the
164membership of its board of directors; and samples of its
165currently used loan documentation. The application must also
166include a detailed description and supporting documentation of
167the nature of the loan administrator's partnerships with local
168or regional economic and business development organizations.
169     (b)  The office, upon selecting a loan administrator, shall
170enter into a grant agreement with the administrator to issue the
171available loans to eligible applicants. The grant agreement must
172specify the aggregate amount of the loans authorized for award
173by the loan administrator. The term of the grant agreement must
174be at least 4 years, except that the office may terminate the
175agreement earlier if the loan administrator fails to meet
176minimum performance standards set by the office. The grant
177agreement may be amended by mutual consent of both parties.
178     (c)  The office shall disburse from the Economic
179Development Trust Fund to the loan administrator the
180appropriations provided for the pilot program. Disbursements to
181the loan administrator must not exceed the aggregate amount of
182the loans authorized in the grant agreement. The office may not
183disburse more than 50 percent of the aggregate amount of the
184loans authorized in the grant agreement until the office
185verifies the borrowers' use of the loan proceeds and the loan
186administrator's successful credit decisionmaking policies.
187     (d)  A loan administrator is entitled to receive a loan
188origination fee, payable at closing, of 1 percent of each loan
189issued by the loan administrator and a servicing fee of 0.625
190percent per annum of the loan's outstanding principal balance,
191payable monthly. The loan administrator shall collect the
192servicing fee from the payments made by the borrower, first
193charging the fee against interest payments and then charging the
194remainder of the fee against repayments of principal.
195     (e)  A loan administrator, after collecting the servicing
196fee in accordance with paragraph (d), shall remit the borrower's
197collected interest, principal payments, and charges for late
198payments to the office on a quarterly basis. If the borrower
199defaults on the loan, the loan administrator shall initiate
200collection efforts to seek repayment of the loan. The loan
201administrator, upon collecting payments for a defaulted loan,
202shall remit the payments to the office but, to the extent
203authorized in the grant agreement, may deduct the costs of the
204administrator's collection efforts. The office shall deposit all
205funds received under this paragraph in the General Revenue Fund.
206     (f)  A loan administrator shall submit quarterly reports to
207the office that include the information required in the grant
208agreement. A quarterly report must include, at a minimum, the
209number of full-time equivalent jobs created as a result of the
210loans, the amount of wages paid to employees in the newly
211created jobs, and the locations and types of economic activity
212undertaken by the borrowers.
213     (6)  The office shall adopt rules under ss. 120.536(1) and
214120.54 to administer this section. To the extent necessary to
215expedite implementation of the pilot program, the office may
216adopt initial emergency rules for the pilot program in
217accordance with s. 120.54(4).
218     (7)  On June 30 and December 31 of each year, beginning in
2192009, the office shall submit a report to the Governor, the
220President of the Senate, and the Speaker of the House of
221Representatives that describes in detail the use of the loan
222funds. The report must include, at a minimum, the number of
223businesses receiving loans, the number of full-time equivalent
224jobs created as a result of the loans, the amount of wages paid
225to employees in the newly created jobs, the locations and types
226of economic activity undertaken by the borrowers, the amounts of
227loan repayments made to date, and the default rate of borrowers.
228     (8)  Unexpended balances of appropriations provided for the
229pilot program shall not revert to the fund from which the
230appropriation was made at the end of a fiscal year but shall be
231retained in the Economic Development Trust Fund and be carried
232forward for expenditure for the pilot program during the
233following fiscal year. A loan administrator may not issue a new
234loan or enter into a loan agreement after June 30, 2011.
235Balances of appropriations provided for the pilot program that
236remain unexpended as of July 1, 2011, shall revert to the
237General Revenue Fund.
238     (9)  This section is repealed July 1, 2019, unless reviewed
239and reenacted by the Legislature before that date.
240     Section 2.  Section 288.1082, Florida Statutes, is created
241to read:
242     288.1082  Economic Gardening Technical Assistance Pilot
243Program.--
244     (1)  There is created within the Office of Tourism, Trade,
245and Economic Development the Economic Gardening Technical
246Assistance Pilot Program. The purpose of the pilot program is to
247stimulate investment in Florida's economy by providing technical
248assistance for expanding businesses in the state. As used in
249this section, the term "office" means the Office of Tourism,
250Trade, and Economic Development.
251     (2)  The office shall contract with one or more entities to
252administer the pilot program under this section. The office
253shall award each contract in accordance with the competitive
254bidding requirements in s. 287.057 to an entity that
255demonstrates it has the ability to implement the pilot program
256on a statewide basis, has an outreach plan, and has the ability
257to provide counseling services, access to technology and
258information, marketing services and advice, business management
259support, and other similar services.
260     (3)  A contracted entity administering the pilot program
261shall provide technical assistance for eligible businesses that
262includes, but is not limited to, the following:
263     (a)  Access to free or affordable information services and
264consulting services, including information on markets,
265customers, and competitors, such as business databases,
266geographic information systems, and search engine marketing.
267     (b)  Information on how to obtain infrastructure, including
268basic physical infrastructure; quality-of-life infrastructure,
269such as parks and open spaces; and intellectual infrastructure
270that provides educational opportunities to help a business
271maintain its competitiveness.
272     (c)  Business connections, including interaction and
273exchange among business owners and resource providers, such as
274trade associations, think tanks, academic institutions, business
275roundtables, peer-to-peer learning sessions, and mentoring
276programs.
277     (4)(a)  To be eligible for assistance under the pilot
278program, a business must be a for-profit, privately held,
279investment-grade business that employs at least 10 persons but
280not more than 99 persons, has maintained its principal place of
281business in the state for at least the previous 2 years,
282generates at least $1 million but not more than $50 million in
283annual revenue, qualifies for the tax refund program for
284qualified target industry businesses under s. 288.106, and,
285during the previous 2-year period, has increased its number of
286full-time equivalent employees in this state by at least 10
287percent.
288     (b)  A contracted entity administering the pilot program,
289in selecting the eligible businesses to receive assistance,
290shall choose businesses in more than one industry cluster that
291are geographically distributed throughout the state or choose
292businesses in partnership with other businesses that are
293geographically distributed throughout the state.
294     (5)(a)  A business receiving assistance under the pilot
295program must enter into an agreement with the contracted entity
296administering the program to establish the business' commitment
297to participation in the pilot program. The agreement must
298require, at a minimum, that the business:
299     1.  Attend a minimum number of meetings between the
300business and the contracted entity administering the pilot
301program.
302     2.  Report job creation data in the manner prescribed by
303the contracted entity administering the pilot program.
304     3.  Provide financial data in the manner prescribed by the
305contracted entity administering the program.
306     (b)  The office or the contracted entity administering the
307pilot program may prescribe additional reporting requirements in
308the agreement that are necessary to track the progress of the
309business and monitor the business' implementation of the
310assistance. The contracted entity shall report the information
311to the office on a quarterly basis.
312     (6)  A contracted entity administering the pilot program is
313an economic development agency as defined in s. 288.075 that is
314authorized to promote the general business interests or
315industrial interests of the state.
316     (7)  The office shall review the progress of a contracted
317entity administering the pilot program at least once each 6
318months and shall determine whether the contracted entity is
319meeting its contractual obligations for administration of the
320pilot program. The office may terminate and rebid a contract if
321the contracted entity does not meet its contractual obligations.
322     (8)  On December 31 of each year, beginning in 2009, the
323office shall submit a report to the Governor, the President of
324the Senate, and the Speaker of the House of Representatives that
325describes in detail the progress of the pilot program. The
326report must include, at a minimum, the number of businesses
327receiving assistance, the number of full-time equivalent jobs
328created as a result of the assistance, if any, the amount of
329wages paid to employees in the newly created jobs, and the
330locations and types of economic activity undertaken by the
331businesses.
332     (9)  The office may adopt rules under ss. 120.536(1) and
333120.54 to administer this section.
334     Section 3.  By December 31, 2012, the Office of Program
335Policy Analysis and Government Accountability shall submit a
336report to the Governor, the President of the Senate, and the
337Speaker of the House of Representatives that evaluates the
338Economic Gardening Technical Assistance Pilot Program in s.
339288.1082, Florida Statutes, and the pilot program's
340effectiveness in expanding the targeted businesses.
341     Section 4.  From the funds provided in a special
342appropriations act for the 2008-2009 fiscal year to the Office
343of Tourism, Trade, and Economic Development for implementation
344of this act, the office may expend up to $1.5 million for
345implementation of the Economic Gardening Technical Assistance
346Pilot Program created in s. 288.1082, Florida Statutes.
347     Section 5.  This act shall take effect upon becoming a law.


CODING: Words stricken are deletions; words underlined are additions.