1Establishing the Pennsylvania Small Business Forgivable Loan
2Program; and conferring powers and imposing duties on the
3Department of Community and Economic Development.

4The General Assembly of the Commonwealth of Pennsylvania
5hereby enacts as follows:

6Section 1. Short title.

7This act shall be known and may be cited as the Pennsylvania
8Small Business Forgivable Loan Program Act.

9Section 2. Declaration of purpose.

10The primary purpose of the Pennsylvania Small Business
11Forgivable Loan Program is to strengthen small businesses in
12low-income to moderate-income neighborhoods across this
13Commonwealth. The program intends to provide assistance to:

14(1) Support a vital mix of small businesses that
15contribute to a successful commercial corridor.

16(2) Help small businesses grow and improve the quality
17of their goods and services to allow them to become social
18anchors in terms of employment and neighborhood

1stabilization.

2Section 3. Definitions.

3The following words and phrases when used in this act shall
4have the meanings given to them in this section unless the
5context clearly indicates otherwise:

6"Department." The Department of Community and Economic
7Development of the Commonwealth.

8"Eligible improvements." The term includes, but is not
9limited to, improvements made to, or addition of, any of the
10following:

11(1) Security systems.

12(2) Telephone systems.

13(3) Alarm systems.

14(4) Point of sale equipment.

15(5) Kitchen equipment.

16(6) Computer ordering systems.

17(7) Millwork.

18(8) Flooring.

19(9) Lighting.

20(10) Sound systems.

21(11) Theater seating.

22(12) Displaying furnishings and shelving.

23(13) HVAC equipment.

24(14) Coolers and refrigeration units.

25(15) Specialty piping, not including normal plumbing
26expenditures.

27(16) Any other similar improvement imperative for
28growth.

29"Program." The Pennsylvania Small Business Forgivable Loan
30Program established under section 4.

1"Qualified applicant." A small business that:

2(1) is located within an eligible commercial corridor,
3as determined by the department; or

4(2) will be located within an eligible commercial
5corridor, as determined by the department, no later than six
6months after the applicant is approved for a loan under the
7program.

8Section 4. Establishment of program.

9The Pennsylvania Small Business Forgivable Loan Program is
10established to help small businesses make eligible improvements
11in a new location or an existing location. The program shall be
12administered by the department.

13Section 5. Requirements for program.

14(a) Application.--The department shall establish a process
15for qualified applicants to apply and be approved for
16participation in the program. The department may require
17applicants to provide certain information, including, but not
18limited to:

19(1) A business plan.

20(2) Various financial documents.

21(3) Any other documentation the department deems
22necessary.

23(b) Evaluation.--Applications shall be evaluated by the
24department on a competitive basis using a variety of criteria,
25including, but not limited to, the following:

26(1) Whether the project will result in any of the
27following:

28(i) Enhancement of an existing cluster of retail,
29food or creative businesses.

30(ii) Generation of increased foot traffic to a

1commercial corridor by attracting or enhancing a business
2that will serve as a destination for new visitors.

3(iii) Improvement of the retail mix found within a
4commercial corridor by starting a new business that meets
5an identified, unmet need for specific goods and
6services.

7(2) Whether financial feasibility and equity investment
8from the applicant match or exceed the loan amount.

9(3) Whether the applicant has demonstrated community
10support.

11(4) Whether the project will impact job retention and
12job creation and the effects of that impact.

13(c) Amount.--The amount of a loan issued under the program
14shall not be less than $25,000 nor more than $50,000.

15(d) Forgiveness.--The following shall apply:

16(1) A loan issued under the program shall be forgiven
17provided the recipient meets the guidelines of the program,
18as determined by the department, for five years.

19(2) If the recipient does not meet the guidelines of the
20program for five years, the recipient shall repay the amount
21of the loan to the department within a period of five years.
22The principal of the loan shall accrue interest beginning at
23the time the recipient fails to meet the guidelines of the
24program. The department shall use the money which is repaid
25to make future loans under the program.

26Section 6. Funding.

27Loans issued under the program may be made to the extent that
28funds are appropriated by the General Assembly or available from
29other sources and are sufficient to cover the administration of
30the program.

1Section 7. Annual report.

2(a) Development of report.--The department shall publish a
3report by December 31, 2015, and every year thereafter for the
4immediately preceding fiscal year. The report shall provide
5information regarding the operation of the program, including:

6(1) The number of program applications received and
7approved by the department.

8(2) The amount of each loan issued under the program by
9the department.

10(3) Any department recommendations for improvements and
11adjustments to program guidelines.

12(b) Submission.--The annual report shall be submitted to the

13Governor, the chairman and minority chairman of the
14Appropriations Committee of the Senate, the chairman and 
15minority chairman of the Community, Economic and Recreational 
16Development Committee of the Senate, the chairman and minority
17chairman of the Appropriations Committee of the House of
18Representatives and the chairman and minority chairman of the 
19Commerce Committee of the House of Representatives.

20Section 8. Tax applicability.

21Loan forgiveness under this act shall not be considered
22taxable income for purposes of Article III of the act of March
234, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971.

24Section 9. Responsibility of the department.

25The department shall administer the program and shall adopt
26such regulations, guidelines, policies, procedures and forms as
27are necessary and not inconsistent with the provisions of this 
28act.

29Section 10. Effective date.

30This act shall take effect in 90 days.