HF 1948

1st Committee Engrossment - 86th Legislature (2009 - 2010)

Posted on 03/19/2013 07:29 p.m.

1.1A bill for an act 1.2relating to economic development; establishing an investment fund for eligible 1.3organizations; authorizing loans; appropriating money;proposing coding for new 1.4law in Minnesota Statutes, chapter 116J. 1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 1.6    Section 1. new text begin [116J.417] GREATER MINNESOTA BUSINESS DEVELOPMENT new text end 1.7 new text begin INVESTMENT FUND. new text end 1.8     new text begin Subdivision 1. new text end new text begin Eligible organization. new text end new text begin For the purposes of this section, "eligible new text end 1.9 new text begin organization" means an organization selected under section 116J.415, subdivision 3, that new text end 1.10 new text begin provides business financing to greater Minnesota businesses. new text end 1.11     new text begin Subd. 2. new text end new text begin Investment fund establishment. new text end new text begin The commissioner shall establish an new text end 1.12 new text begin investment fund from which fund investments can be made in eligible organizations. The new text end 1.13 new text begin funds repaid by the eligible organizations must be returned to the fund for subsequent new text end 1.14 new text begin reinvestment in eligible organizations. new text end 1.15     new text begin Subd. 3. new text end new text begin Authorized investments. new text end new text begin The commissioner may make investments in new text end 1.16 new text begin eligible organizations. The commissioner shall invest funds in the form of loans to eligible new text end 1.17 new text begin organizations for the purpose of providing capital to new and expanding businesses in the new text end 1.18 new text begin form of debt or equity, or both. new text end 1.19     new text begin Subd. 4. new text end new text begin Investment authorized. new text end new text begin The commissioner may make investments in new text end 1.20 new text begin eligible organizations under the following terms: new text end 1.21 new text begin (1) the organization seeking an investment of funds must guarantee repayment of not new text end 1.22 new text begin less than 100 percent of the funds invested in the eligible organization; new text end 1.23 new text begin (2) the investments must be made in the form of a loan to the eligible organization new text end 1.24 new text begin for a term of ten years, at an interest rate of one percent; new text end 2.1 new text begin (3) during the ten-year term of the loan, the eligible organization must make annual new text end 2.2 new text begin interest-only payments; new text end 2.3 new text begin (4) at the end of the ten-year term, the eligible organization must make a payment in new text end 2.4 new text begin the entire principal amount of the initial loan; new text end 2.5 new text begin (5) the state investment by the commissioner in any eligible organization must new text end 2.6 new text begin not exceed $2,000,000; new text end 2.7 new text begin (6) the full amount of state investment must be advanced to the approved eligible new text end 2.8 new text begin organization upon execution of a formal investment agreement, specifying the terms of the new text end 2.9 new text begin loan, as well as reporting and other requirements outlined in subdivision 5; new text end 2.10 new text begin (7) the eligible organization must maintain the funds in accounts that allow the funds new text end 2.11 new text begin to be readily available for business investments; new text end 2.12 new text begin (8) the eligible organization must make business investments totaling the entire new text end 2.13 new text begin amount of funds loaned by the state within three years of the execution of the investment new text end 2.14 new text begin agreement and subsequent transmittal of the funds; and new text end 2.15 new text begin (9) an eligible organization that receives an investment under this section must new text end 2.16 new text begin report annually, in a format prescribed by the commissioner, the nature and amount of new text end 2.17 new text begin the business investments made, including, for each financing transaction involving funds new text end 2.18 new text begin received pursuant to this section, all forms and amounts of financing provided by the new text end 2.19 new text begin eligible organization from sources other than the investment fund established pursuant to new text end 2.20 new text begin this section, along with the number of jobs created and private sector investment leveraged. new text end 2.21     new text begin Subd. 5. new text end new text begin Requirements for state investments. new text end new text begin All investments are subject to an new text end 2.22 new text begin investment agreement which must include: new text end 2.23 new text begin (1) a description of the eligible organization, including business finance experience, new text end 2.24 new text begin qualifications, and investment history; new text end 2.25 new text begin (2) a description of the uses of investment proceeds by the eligible organization; new text end 2.26 new text begin (3) an explanation of the investment objectives; new text end 2.27 new text begin (4) a description of accounting and reporting standards to be used by the eligible new text end 2.28 new text begin organization; and new text end 2.29 new text begin (5) a copy of the most recent audited financial statements of the eligible organization. new text end 2.30    Sec. 2. new text begin APPROPRIATION. new text end 2.31 new text begin $12,000,000 is appropriated in fiscal year 2010 from the general fund to the new text end 2.32 new text begin commissioner of employment and economic development to provide loans authorized new text end 2.33 new text begin under section 1. This appropriation is available until expended. new text end