PRINTER'S NO. 1770
No. 1045 Session of 2002
INTRODUCED BY WAUGH, WENGER, BRIGHTBILL, JUBELIRER, PUNT, O'PAKE, KITCHEN, MADIGAN, LAVALLE, HELFRICK, MUSTO, KUKOVICH, DENT, MOWERY, CORMAN, M. WHITE, BOSCOLA, KASUNIC, LEMMOND, GREENLEAF, CONTI AND RHOADES, MARCH 11, 2002
REFERRED TO AGRICULTURE AND RURAL AFFAIRS, MARCH 11, 2002
AN ACT 1 Amending the act of June 29, 1996 (P.L.434, No.67), entitled, as 2 amended, "An act to enhance job creation and economic 3 development by providing for an annual financing strategy, 4 for opportunity grants, for job creation tax credits, for 5 small business assistance, for the Small Business Advocacy 6 Council, for a family savings program, for industrial 7 development assistance, for community development bank grants 8 and loans and for tax-exempt bond allocation; conferring 9 powers and duties on various administrative agencies and 10 authorities; further providing for various funds; and making 11 repeals," further providing for loans for agricultural 12 producers. 13 The General Assembly of the Commonwealth of Pennsylvania 14 hereby enacts as follows: 15 Section 1. The definitions of "capital development project" 16 and "small business enterprise" in section 1301 of the act of 17 June 29, 1996 (P.L.434, No.67), known as the Job Enhancement 18 Act, added December 3, 1998 (P.L.788, No.100), are amended and 19 the section is amended by adding definitions to read: 20 Section 1301. Definitions. 21 The following words and phrases when used in this chapter 22 shall have the meanings given to them in this section unless the
1 context clearly indicates otherwise: 2 * * * 3 "Agricultural producer." A person involved in the management 4 and use of a normal agricultural operation for the production of 5 a farm commodity. 6 * * * 7 "Capital development project" or "project." Land, buildings, 8 equipment and machinery and working capital which is acquired, 9 constructed, renovated or used by a small business enterprise: 10 (1) As part of a for-profit project or venture not of a 11 mercantile or service-related nature, except for hospitality 12 industry projects. 13 (2) To bring a small business enterprise into compliance 14 with Federal or State environmental laws or regulations or to 15 complete an approved remediation project or to permit the 16 small business enterprise to adopt generally acceptable 17 pollution prevention practices. 18 (3) To provide assistance to small business enterprises 19 that are recyclers of municipal or commercial waste or that 20 are manufacturers using recycled municipal or commercial 21 waste materials. 22 (4) To assist a small business enterprise with defense 23 conversion activities. 24 (5) For the manufacture of products to be exported out 25 of the United States by a small business enterprise as part 26 of a for-profit project or venture not of a mercantile or 27 service-related nature, except for export-related services 28 and international export-related mercantile ventures or 29 advanced technology and computer-related services and 30 mercantile ventures, which will increase this Commonwealth's 20020S1045B1770 - 2 -
1 national or international market shares. 2 (6) As part of a for-profit project or venture that 3 meets the requirements of section 1303(a.1) and (a.3). 4 * * * 5 "Normal agricultural operation." The activities, practices, 6 equipment and procedures which agricultural producers adopt, use 7 or engage in in the production and preparation for market of 8 farm commodities. The term includes new activities, practices, 9 equipment and procedures consistent with technological 10 development within the agricultural industry. 11 * * * 12 "Small business [enterprises] enterprise." A for-profit 13 corporation, partnership or proprietorship which meets the 14 eligibility requirements established by the department. The term 15 shall include, but is not limited to, a small business 16 [enterprises] enterprise which: 17 (1) is located in a small business incubator 18 [facilities, small business enterprises which are] facility; 19 (2) is an agricultural [processors and small business 20 enterprises which manufacture] processor; 21 (3) is an agricultural producer; or 22 (4) manufactures apparel products. 23 * * * 24 Section 2. Section 1303(a.2) and (b) of the act, amended 25 November 17, 1998 (P.L.788, No.100), are amended and the section 26 is amended by adding a subsection to read: 27 Section 1303. Eligibility for and terms and conditions of 28 loans. 29 * * * 30 (a.2) Pollution prevention assistance loans.--The Pollution 20020S1045B1770 - 3 -
1 Prevention Assistance Account created under section 1302(b.1) 2 shall provide revolving loans to small [businesses] business 3 enterprises. 4 (1) The loans shall be for the purpose of enabling the 5 small business enterprise to adopt or install pollution 6 prevention equipment or processes to: 7 (i) Reduce or reuse raw materials onsite. 8 (ii) Reduce the production of waste. 9 (iii) Reduce energy consumption. 10 (2) The Pollution Prevention Assistance Account shall 11 not invest on the basis of direct financial return and shall 12 not be held to the loan loss standards of commercial lenders. 13 Loans shall be for the purpose of reducing pollution through 14 source reduction technologies or processes. 15 (3) A loan under this subsection may not exceed the 16 lesser of: 17 (i) $50,000; or 18 (ii) 75% of eligible project costs. 19 (4) Loans under this subsection shall have an interest 20 rate of 2% per year and a maximum repayment term of seven 21 years. 22 (5) An industrial resource center receiving funds under 23 the act of July 2, 1993 (P.L.439, No.64), known as the Ben 24 Franklin/IRC Partnership Act, may utilize the account to 25 provide assistance to a small business enterprise for which a 26 loan application has been made. 27 (6) Loans under this subsection shall be used to further 28 the goal of pollution prevention through the purchase and 29 installation of equipment to make operational changes and 30 modify production practices. 20020S1045B1770 - 4 -
1 (a.3) Loans to small business enterprises which are 2 agricultural producers.-- 3 (1) The department may provide loans to small business 4 enterprises which are agricultural producers. Loans shall be 5 made in accordance with the provisions of this chapter except 6 as follows: 7 (i) The provisions of subsection (b) relating to 8 required increases in employment shall not apply to loans 9 made under this subsection. 10 (ii) The department may authorize flexible repayment 11 terms and an interest rate of not less than 2%. 12 (iii) The department may utilize additional area 13 loan organizations, including community development 14 financial institutions, to receive loan applications and 15 administer loans. 16 (iv) The department may use its best judgment to 17 identify and secure collateral. 18 (2) The department and area loan organizations shall not 19 make loans under this subsection on the basis of direct 20 financial return on investment and shall not be held to the 21 loan loss standards of private commercial lenders. Loans 22 shall be for the purpose of enhancement and growth of normal 23 agricultural operations. 24 (b) Terms and conditions.-- 25 (1) The department may make advances from the Small 26 Business First Fund, subject to the terms, conditions and 27 restrictions provided under this chapter, to area loan 28 organizations for the purpose of making loans to eligible 29 small business enterprises for capital development projects 30 which demonstrate a substantial likelihood of creating or 20020S1045B1770 - 5 -
1 preserving employment opportunities. All loans shall be 2 limited to projects that demonstrate the creation or 3 preservation of one job for every $25,000 received from the 4 Small Business First Fund. 5 (2) No loans shall be made which would do any of the 6 following: 7 (i) Cause, aid or assist in, directly, the 8 relocation of any business operations from one part of 9 this Commonwealth to another unless there is at least a 10 25% net increase in employment. 11 (ii) Refinance any portion of the total project cost 12 or other existing loans or debt. 13 (iii) Finance projects located outside the 14 geographic boundaries of this Commonwealth. 15 (iv) Provide funds, directly or indirectly, for 16 payment, distribution or as loan owners, partners or 17 shareholders of the small business enterprise, except as 18 ordinary compensation for services rendered. 19 (v) Provide funds for speculation in any kind of 20 property, real or personal, tangible or intangible. 21 (3) All loans shall carry an interest rate and term and 22 shall be secured by lien positions on collateral at the 23 highest level of priority as may be determined by the area 24 loan organization with the approval of the department. 25 Section 3. This act shall take effect immediately. C4L12VDL/20020S1045B1770 - 6 -