Minnesota Session Laws - 2001, Regular Session

                            CHAPTER 153-S.F.No. 1472 
                  An act relating to economic development; modifying the 
                  capital access program; amending Minnesota Statutes 
                  2000, sections 116J.876, by adding a subdivision; 
                  116J.8761; and 116J.8762, subdivision 1; proposing 
                  coding for new law in Minnesota Statutes, chapter 116J.
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
           Section 1.  Minnesota Statutes 2000, section 116J.876, by 
        adding a subdivision to read:  
           Subd. 6a.  [COMMUNITY DEVELOPMENT VENTURE CAPITAL 
        FUND.] "Community development venture capital fund" means a 
        regional or local venture capital fund that makes equity 
        investments in small or emerging companies and has a financial 
        as well as a social mission. 
           Sec. 2.  Minnesota Statutes 2000, section 116J.8761, is 
        amended to read: 
           116J.8761 [CAPITAL ACCESS PROGRAM; CREATION; 
        ADMINISTRATION.] 
           A capital access program is created in the department of 
        trade and economic development.  The purpose of the capital 
        access program is to provide capital to businesses, particularly 
        small and medium-sized businesses, to foster economic 
        development.  Capital may be provided in the form of equity 
        investments for community development venture capital funds or 
        loans for all other assistance under the program.  Loans made 
        under this program are to be slightly riskier than conventional 
        loans, but still offer a high degree of soundness in connection 
        with the capital access program. 
           The commissioner has the power to administer the program, 
        enter into contracts, and take action reasonably necessary to 
        ensure compliance with the program.  The lender shall provide 
        the commissioner with information regarding its participation in 
        the program as the commissioner may reasonably require.  Upon 
        notice to the lender, the commissioner may inspect the files of 
        the lender relating to any loans enrolled under the program 
        during normal business hours of the lender. 
           A lender is eligible to participate in the program upon 
        entering into an agreement with the commissioner governing the 
        duties of the commissioner and the lender under the program. 
           Sec. 3.  Minnesota Statutes 2000, section 116J.8762, 
        subdivision 1, is amended to read: 
           Subdivision 1.  [DUTIES.] The commissioner must:  
           (1) with respect to loans: 
           (1) (i) market the capital access program to businesses and 
        other persons in the state in cooperation with financial 
        institutions and statewide associations representing financial 
        institutions; 
           (2) (ii) establish a reservation or allocation system so 
        that lenders may reserve an allocation of funds in the account 
        before or after the lender enters into a loan agreement or 
        contract with a borrower; and 
           (3) (iii) develop the program, in cooperation with 
        financial institutions and statewide associations representing 
        financial institutions, so that the degree of flexibility for 
        the commissioner and the participating lenders is maximized and 
        the state oversight of individual loans is minimized, and the 
        fiscal integrity of the program is maintained.; and 
           (2) with respect to equity investments: 
           (i) market the program to businesses and community 
        development venture capital funds; and 
           (ii) enter into appropriate contracts and agreements with 
        community development venture capital funds.  
           Sec. 4.  [116J.8770] [EQUITY INVESTMENTS.] 
           The commissioner may invest funds from the capital access 
        account to make equity investments in community development 
        venture capital funds for the purpose of providing capital for 
        small and emerging businesses.  The community development 
        venture capital fund must have experience in equity investments 
        with small businesses and the ability to raise private capital. 
           Sec. 5.  [116J.8771] [WAIVER.] 
           The capital access program is exempt from section 16C.05, 
        subdivision 2, paragraph (a), clause (5). 
           Sec. 6.  [REVISOR'S INSTRUCTION.] 
           The revisor shall substitute "116J.8771" for "116J.8769" in 
        Minnesota Statutes, sections 116J.876, subdivisions 1 and 12; 
        116J.8765, subdivision 1; and 116J.8766, subdivision 2. 
           Sec. 7.  [EFFECTIVE DATE.] 
           Sections 1 to 5 are effective the day following final 
        enactment. 
           Presented to the governor May 17, 2001 
           Signed by the governor May 21, 2001, 10:55 a.m.