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        PRIOR PRINTER'S NOS. 3712, 3784               PRINTER'S NO. 3834



No. 2503 Session of 2008

           K. SMITH, MAY 7, 2008

           JUNE 2, 2008

                                     AN ACT

     1  Amending Title 12 (Commerce and Trade) of the Pennsylvania
     2     Consolidated Statutes, further providing for definitions; and
     3     providing for loans from the Pennsylvania Industrial
     4     Development Authority.

     5     The General Assembly of the Commonwealth of Pennsylvania
     6  hereby enacts as follows:
     7     Section 1.  Sections 2902, 2903, 2904 and 2905(a) of Title 12
     8  of the Pennsylvania Consolidated Statutes are amended to read:
     9  § 2902.  Definitions.
    10     The following words and phrases when used in this chapter
    11  shall have the meanings given to them in this section unless the
    12  context clearly indicates otherwise:
    13     "Authority."  The Pennsylvania Industrial Development
    14  Authority established under the act of May 17, 1956 (1955
    15  P.L.1609, No.537), known as the Pennsylvania Industrial
    16  Development Authority Act.
    17     "Business enterprise."  A for-profit corporation, partnership

     1  or proprietorship. The term includes a medical facility.
     2     "Farm commodity."  Any Pennsylvania-grown agricultural,
     3  horticultural, aquacultural, vegetable, fruit and floricultural
     4  product of the soil, livestock and meats, wools, hides, furs,
     5  poultry, eggs, dairy products, nuts, mushrooms, honey products
     6  and forest products.
     7     "Fund."  The Machinery and Equipment Loan Fund created and
     8  established by this chapter.
     9     "Medical facility."  An entity licensed as a hospital under
    10  the act of June 13, 1967 (P.L.31, No.21), known as the Public
    11  Welfare Code, or the act of July 19, 1979 (P.L.130, No.48),
    12  known as the Health Care Facilities Act.
    13     "Normal agricultural operation."  The term shall have the
    14  same meaning as given to it in section 2 of the act of June 10,
    15  1982 (P.L.454, No.133), entitled "An act protecting agricultural
    16  operations from nuisance suits and ordinances under certain
    17  circumstances."
    18     "PIDA Act."  The act of May 17, 1956 (1955 P.L.1609, No.537),
    19  known as the Pennsylvania Industrial Development Authority Act.
    20     "Production agriculture."  The management and use of a normal
    21  agricultural operation for the production of a farm commodity.
    22  § 2903.  Establishment.
    23     There is established within the department a program to be
    24  known as the Machinery and Equipment Loan Program. [The] Except
    25  as otherwise provided in this chapter, the program shall be
    26  administered by the department and provide loans to business
    27  enterprises for machinery and equipment.
    28  § 2904.  Machinery and Equipment Loan Fund.
    29     (a)  Creation.--There is created a special account in the
    30  Treasury Department, to be known as the Machinery and Equipment
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     1  Loan Fund, to which shall be credited all program appropriations
     2  made by the General Assembly, all [proceeds from loan             <--
     3  repayments] LOAN REPAYMENTS FROM LOANS made through June 30,      <--
     4  2008, and any and all other deposits, payments or contributions
     5  from any other source made available to the fund. Loan
     6  repayments from loans made after June 30, 2008, shall be paid to
     7  the authority. The fund shall operate as a revolving fund
     8  whereby all appropriations, payments and interest made thereto
     9  may be applied and reapplied to the purposes of this chapter.
    10     (b)  Credits to fund.--All appropriations, deposits and
    11  contributions made to the fund shall be immediately credited in
    12  full to the fund, and earnings on the moneys held in the fund
    13  shall also be credited to the fund for the purposes of this
    14  chapter.
    15     (c)  Transfers to the authority.--At the beginning of each
    16  fiscal year commencing with the fiscal year beginning July 1,
    17  2008, a portion of the unencumbered moneys in the fund, as
    18  determined by the secretary, shall be transferred to the
    19  authority. The authority may use such funds for any purpose
    20  authorized under law.
    21  § 2905.  Eligibility for loans; terms and conditions.
    22     (a)  Loans; general rules.--The secretary may make advances
    23  from the fund, subject to the terms, conditions and restrictions
    24  provided under this chapter, for the purpose of making loans to
    25  business enterprises involved in industrial processes, mining,
    26  manufacturing, production agriculture, information technology,
    27  biotechnology, service as a medical facility or other industrial
    28  or technology sectors, as defined by the department, to acquire
    29  and install new machinery and equipment or upgrade existing
    30  machinery and equipment, including the acquisition, application
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     1  and utilization of computer hardware and software.
     2         (1)  All loans shall be subject to all of the following
     3     conditions:
     4             (i)  Be made to eligible business enterprises under
     5         the provisions of this chapter.
     6             (ii)  Have a maximum loan ceiling of $5,000,000 or
     7         50% of the cost of the project, whichever is less.
     8             (iii)  Be limited to the purchase and installation of
     9         new equipment and machinery or the upgrade of existing
    10         machinery and equipment. This subparagraph includes the
    11         acquisition, application and utilization of computer
    12         hardware and software.
    13             (iv)  Be limited to projects that demonstrate [the
    14         creation or retention of one job for every $25,000
    15         received from the fund] job creation or retention at a
    16         rate determined by the department. This subparagraph does
    17         not apply to loans made to business enterprises involved
    18         in production agriculture or to loans made to medical
    19         facilities.
    20             (v)  Have an interest rate which shall be established
    21         by the secretary.
    22             (vi)  Have a term of [not in excess of] ten years or
    23         less.
    24         (2)  For loans to medical facilities, loan funds may be
    25     used only to finance the acquisition, installation and
    26     utilization of machinery and equipment, including computer
    27     hardware and software components, to be used in the
    28     prescribing and dispensing of medication for medical facility
    29     patients.
    30     * * *
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     1     Section 2.  Title 12 is amended by adding a section to read:
     2  § 2913.  Loans from authority.
     3     (a)  Review of application.--Prior to the review and
     4  investigation of an application submitted under section 2906
     5  (relating to application and administration), the secretary may
     6  forward the application to the authority to be reviewed and
     7  investigated by the authority for a possible loan from the
     8  authority in lieu of a loan from the department under this
     9  chapter.
    10     (b)  Loans from authority.--In addition to the powers of the
    11  authority under the PIDA Act, the authority is authorized to
    12  make loans meeting the eligibility and other requirements of
    13  this chapter.
    14     (c)  Minimum loan amount.--
    15         (1)  Except as set forth in paragraph (2), no less than
    16     25% of the amount loaned by the authority in a single fiscal
    17     year must meet the requirements of section 2905 (relating to
    18     eligibility for loans; terms and conditions).
    19         (2)  If the total of applications under this chapter are
    20     eligible for less than 25% of the amount loaned by the
    21     authority in a single fiscal year, unused funds may be loaned
    22     by the authority in accordance with the PIDA Act.
    23     (d)  Requirements.--A recipient of any loan made under this
    24  section shall be subject to the requirements of this chapter as
    25  though the secretary made the advances for the loan under
    26  section 2905(a).
    27     (e)  Repayment.--Repayments of loans made by the authority
    28  with funds transferred to the authority under section 2904(c)
    29  (relating to Machinery and Equipment Loan Fund) shall be made
    30  directly to the authority.
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     1     Section 3.  This act shall take effect immediately.

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