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| THE GENERAL ASSEMBLY OF PENNSYLVANIA |
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| SENATE BILL |
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| INTRODUCED BY BAKER, YUDICHAK, GORDNER, SOLOBAY, FERLO, GREENLEAF, KASUNIC, LEACH, SCHWANK, WILLIAMS, BLAKE, BOSCOLA, COSTA AND ARGALL, OCTOBER 18, 2011 |
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| REFERRED TO COMMUNITY, ECONOMIC AND RECREATIONAL DEVELOPMENT, OCTOBER 18, 2011 |
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| AN ACT |
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1 | Providing for a Small Business Flood Relief Program; making an |
2 | appropriation; and providing for termination of the program. |
3 | The General Assembly of the Commonwealth of Pennsylvania |
4 | hereby enacts as follows: |
5 | Section 1. Short title. |
6 | This act shall be known and may be cited as the Small |
7 | Business Flood Relief Act of 2011. |
8 | Section 2. Declaration of policy. |
9 | (1) Hurricane Irene and Tropical Storm Lee and the |
10 | resulting flood emergency impacted many small businesses of |
11 | this Commonwealth, causing substantial economic and physical |
12 | damage. |
13 | (2) Small businesses are an integral part of communities |
14 | and a vital component to Pennsylvania's economy. |
15 | (3) Federal emergency declarations designated certain |
16 | areas as eligible for business disaster assistance. |
17 | (4) Pursuant to section 17(b) of Article VIII of the |
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1 | Constitution of Pennsylvania, the Commonwealth should provide |
2 | additional assistance to certain businesses to supplement |
3 | compensation received from private insurance and the Federal |
4 | Government. |
5 | Section 3. Definitions. |
6 | The following words and phrases when used in this act shall |
7 | have the meanings given to them in this section unless the |
8 | context clearly indicates otherwise: |
9 | "Adjusted loss." The difference between: |
10 | (1) eligible loss; and |
11 | (2) covered loss. |
12 | "Covered loss." Any amount received by or due the recipient |
13 | from private insurance and Federal loans on account of an |
14 | eligible loss. The term does not include an insurance deductible |
15 | paid by the recipient. |
16 | "Department." The Department of Community and Economic |
17 | Development of the Commonwealth. |
18 | "Eligible loss." Damage caused as a result of Hurricane |
19 | Irene and Tropical Storm Lee to a small business and certified |
20 | by the Pennsylvania Emergency Management Agency. |
21 | "Program." The Small Business Flood Relief Program |
22 | established under section 6. |
23 | "Small business." A person that is engaged in a for-profit |
24 | enterprise and that employs 100 or fewer individuals. |
25 | "Working capital." Capital used by a small business for |
26 | operations, excluding fixed assets and machinery and equipment. |
27 | Section 4. Powers and duties of department. |
28 | The department shall adopt guidelines to administer the |
29 | program. |
30 | Section 5. Restricted account. |
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1 | A restricted account is established in the State Treasury to |
2 | be known as the Small Business Flood Relief Account. The account |
3 | shall be for the purpose of making loans that shall be provided |
4 | to small businesses eligible for assistance under the program |
5 | authorized under section 6 and be funded by the appropriation |
6 | contained in section 7 from which loans to small businesses |
7 | shall be provided by the department to eligible small |
8 | businesses. |
9 | Section 6. Small Business Flood Relief Program. |
10 | (a) Establishment.--There is established the Small Business |
11 | Flood Relief Program. |
12 | (b) Eligibility.--To be eligible for a loan, a small |
13 | business must meet all of the following: |
14 | (1) Be located in a county that has been declared a |
15 | Federal disaster area as a result of Hurricane Irene or |
16 | Tropical Storm Lee. |
17 | (2) Suffer an eligible loss. |
18 | (3) Meet the definition of small business in section 3. |
19 | (4) Be registered and in good standing with the |
20 | Department of Revenue. |
21 | (c) Procedure.-- |
22 | (1) A small business shall apply for a loan under this |
23 | section on a form furnished by the department, setting forth |
24 | the facts establishing eligibility. An application under this |
25 | paragraph is subject to 18 Pa.C.S. § 4904 (relating to |
26 | unsworn falsification to authorities). |
27 | (2) The department shall investigate the application to |
28 | determine eligibility. |
29 | (3) Within 30 days of receipt of the application, the |
30 | department shall make an eligibility and loan determination. |
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1 | (d) Loans.-- |
2 | (1) The minimum loan amount to be awarded is $10,000 and |
3 | the maximum loan amount to be awarded under this program is |
4 | $100,000. |
5 | (2) Loan proceeds may be used for working capital, |
6 | inventory, equipment purchase and real property improvements, |
7 | if owned by the borrower, but cannot be used for refinancing |
8 | existing debt or outstanding debt payments. Equipment and |
9 | real property must be located within this Commonwealth. |
10 | (3) Loan proceeds must be drawn within 60 days of the |
11 | loan approval date. Failure to draw funds within the required |
12 | time period will result in revocation of the loan. |
13 | (4) Loan applications will be reviewed and loans |
14 | approved on a first-come, first-served basis until available |
15 | funds are exhausted. |
16 | (e) Loan terms.-- |
17 | (1) A loan for working capital or inventory shall be |
18 | made at an interest rate not to exceed 3% for the term of the |
19 | loan. The repayment period shall not exceed five years. |
20 | (2) A loan for equipment purchase or real property |
21 | improvement shall be made at an interest rate not to exceed |
22 | 1% for the term of the loan. The repayment period shall not |
23 | exceed 10 years. |
24 | Section 7. Appropriation. |
25 | The sum of $15,000,000, or as much as may be necessary, is |
26 | appropriated to the department to carry out the purpose of this |
27 | act. |
28 | Section 8. Termination. |
29 | The program and account established under sections 5 and 6 |
30 | shall terminate on June 30, 2012, and any money remaining in the |
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1 | account shall be transferred to the General Fund. |
2 | Section 9. Effective date. |
3 | This act shall take effect immediately. |
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