House File 97 - Introduced
HOUSE FILE
BY HOGG and DANDEKAR
Passed House, Date Passed Senate, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act creating a small business development program and fund.
2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
3 TLSB 1370YH 81
4 tm/pj/5
PAG LIN
1 1 Section 1. NEW SECTION. 15.301 SMALL BUSINESS
1 2 DEVELOPMENT PROGRAM == FUND.
1 3 1. The department shall establish and administer a small
1 4 business development program for purposes of providing
1 5 financial assistance for small businesses. Financial
1 6 assistance under the program shall be provided from the small
1 7 business development fund created in subsection 6.
1 8 2. A business is eligible to apply for financial
1 9 assistance under the program if the business meets all of the
1 10 following criteria at the time of application:
1 11 a. The business has fifty or fewer employees.
1 12 b. The business is located in Iowa.
1 13 c. The business is owned, operated, and actively managed
1 14 by a resident of Iowa.
1 15 3. If an eligible business is a start=up business, all of
1 16 the following criteria must be met prior to applying for
1 17 financial assistance:
1 18 a. The eligible business must have a business plan and
1 19 must have received assistance in the development stage from a
1 20 small business development center or from a qualified public
1 21 or nonprofit small business consultant as defined by the
1 22 department.
1 23 b. The city or county where the business is to be located
1 24 must show support of the business and the location of the
1 25 business through an ordinance or resolution.
1 26 c. The eligible business must receive all required permits
1 27 at the proposed location for the business.
1 28 4. Upon approval of financial assistance under the program
1 29 by the department, the eligible business shall enter into an
1 30 agreement with the department which shall include, but not be
1 31 limited to, all of the following provisions:
1 32 a. Identification of the eligibility requirements under
1 33 the program and a statement that the requirements have been
1 34 met.
1 35 b. If the eligible business sells or moves any facility
2 1 within the state prior to receiving financial assistance under
2 2 the program, the department may reduce or eliminate a portion
2 3 or all of the financial assistance.
2 4 c. If the eligible business sells or moves any facility
2 5 within the state within five years of receiving financial
2 6 assistance under the program, the eligible business may be
2 7 subject to repayment of a portion or all of the financial
2 8 assistance received.
2 9 5. An eligible business shall not receive more than one
2 10 award of financial assistance under the program every five
2 11 years. An eligible business that receives financial
2 12 assistance under the program shall not receive any other
2 13 financial assistance from the department during the same
2 14 fiscal year.
2 15 6. a. A small business development fund is created in the
2 16 state treasury under the control of the department and
2 17 consisting of any moneys appropriated to the fund by the
2 18 general assembly and any other moneys available and obtained
2 19 or accepted by the department for placement in the fund.
2 20 Payments of interest, repayments of moneys loaned pursuant to
2 21 this section, and recaptures of loans shall be deposited in
2 22 the fund. The fund shall be used to provide financial
2 23 assistance under the program in the form of grants, low=
2 24 interest loans, and forgivable loans. Moneys in the fund are
2 25 not subject to section 8.33. Notwithstanding section 12C.7,
2 26 interest or earnings on moneys in the fund shall be credited
2 27 to the fund.
2 28 b. Financial assistance in the form of a grant or a
2 29 forgivable loan shall not exceed ten thousand dollars.
2 30 Financial assistance in the form of a low=interest loan shall
2 31 not exceed twenty=five thousand dollars.
2 32 7. The department shall adopt rules pursuant to chapter
2 33 17A as necessary to administer the program.
2 34 EXPLANATION
2 35 This bill creates a small business development program and
3 1 fund.
3 2 The bill provides that the department of economic
3 3 development shall establish and administer a small business
3 4 development program for purposes of providing financial
3 5 assistance for small businesses. The bill provides that a
3 6 business is eligible to apply for financial assistance under
3 7 the program if the business, at the time of application, has
3 8 50 or fewer employees, is located in Iowa, and is owned,
3 9 operated, and actively managed by a resident of Iowa.
3 10 The bill provides that, if an eligible business is a start=
3 11 up business, the eligible business must have a business plan
3 12 and must have received assistance in the development stage
3 13 from a small business development center or from a qualified
3 14 public or nonprofit small business consultant as defined by
3 15 the department, the city or county where the business is to be
3 16 located must show approval of the business and the location
3 17 through ordinance or resolution, and the eligible business
3 18 must receive all required permits at the proposed location for
3 19 the business.
3 20 The bill provides that, upon approval of financial
3 21 assistance under the program by the department, the eligible
3 22 business shall enter into an agreement with the department
3 23 which shall include, but not be limited to, provisions
3 24 relating to eligibility requirements under the program and
3 25 reducing, eliminating, or requiring the repayment of financial
3 26 assistance received under the program if the eligible business
3 27 sells or moves any facility within the state. The bill
3 28 provides that an eligible business shall not receive more than
3 29 one award of financial assistance under the program every five
3 30 years. The bill provides that an eligible business that
3 31 receives financial assistance under the program shall not
3 32 receive any other financial assistance from the department
3 33 during the same fiscal year.
3 34 The bill creates a small business development fund in the
3 35 state treasury under the control of the department and
4 1 consisting of any moneys appropriated by the general assembly
4 2 and any other moneys available and obtained or accepted by the
4 3 department for placement in the fund. The bill provides that
4 4 the fund shall be used to provide financial assistance under
4 5 the program in the form of grants, low=interest loans, and
4 6 forgivable loans. The bill provides that financial assistance
4 7 in the form of a grant or forgivable loan shall not exceed
4 8 $10,000 and financial assistance in the form of a low=interest
4 9 loan shall not exceed $25,000.
4 10 The bill requires the department to adopt rules as
4 11 necessary to administer the program.
4 12 LSB 1370YH 81
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