S1224-2013 Actions

• Jan 9, 2013: REFERRED TO FINANCE

S1224-2013 Memo

BILL NUMBER:S1224

TITLE  OF  BILL:    An  act  to amend the economic development law, in
relation to microenterprise development; and making  an  appropriation
therefor

PURPOSE OR GENERAL IDEA OF BILL:
Establishes  the  microenterprise development act to assist very small
businesses and low-income entrepreneurs.

SUMMARY OF SPECIFIC PROVISIONS:
This bill amends the economic development law by adding a new  article
9-B. Section 217(a) provides definitions for terms. Section 217(b) (1)
requires the commissioner of the department of economic development to
establish a grant program for microenterprise technical assistance. In
addition,  it  mandates  an  annual  appropriation of no less than one
million dollars.  Subparagraph (2) establishes that the  organizations
receiving  funding  shall  use  the  grants  to  provide  training and
technical   assistance   to   the    microenterprise    entrepreneurs.
Subparagraph  (3)  provides  that  not  less than fifty percent of the
funds made available are used to benefit person whose  income  is  not
more  than  150%  of  the  poverty  line as defined in 42 use 9902(2).
Subparagraph (4) requires the training organizations to have  received
at  least  one dollar in matching funds for every dollar received from
the state. Section 4 of the legislation requires an initial allocation
of $1.5 million.

JUSTIFICATION:
Development and expansion of  businesses  in  economically  distressed
communities in both rural and urban areas can assist residents who are
unemployed, underemployed or in low-income jobs.  Microenterprises are
an  important factor is addressing this need for development. However,
many low-income entrepreneurs lack access  to  capital,  training  and
technical  assistance.  This legislation will provide vital funding to
local support organizations that can  leverage  charitable  foundation
and   private  sector  support,  to  provide  the  much  needed  these
entrepreneurs with vital assistance.

The recent awarding of the Nobel Peace  Prize  to  Muhammad  Yunus,  a
pioneer  in  microfinancing,  has  brought  attention  to  the lack of
financing for these well deserving businesses. An estimated 22 million
micro enterprises operate throughout the country, and provide  18%  of
all  private  U.S.  employment.  This  legislation will strengthen the
state economy by enabling new businesses and  giving  them  the  tools
needed to succeed.

PRIOR LEGISLATIVE HISTORY:
2011-12: S.4204 Referred to Finance
2009-10: A.1639 Referred to Economic Development
2007-08: Referred to Economic Development

FISCAL IMPLICATIONS:
$1.5 million appropriation.

EFFECTIVE DATE:


This act shall take effect on the first of July next
succeeding the date on which it shall have become law.

S1224-2013 Text

 S T A T E   O F   N E W   Y O R K
 
 
                                         1224
 2013-2014 Regular Sessions
 I N  SENATE
 (PREFILED)
 January 9, 2013
 
 Introduced  by  Sen. PERKINS -- read twice and ordered printed, and when
 printed to be committed to the Committee on Finance
 

AN ACT to amend the economic development law, in relation to microenter
 prise development; and making an appropriation therefor
 THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM
 BLY, DO ENACT AS FOLLOWS:

 

Section  1.  Short  title. This act shall be known and may be cited as
 the "microenterprise development act".
 

S 2. Legislative findings and purpose. (a) The  legislature  finds  as
 follows:

 1.  Development and expansion of businesses in economically distressed
 communities in both rural and urban areas can assist residents  who  are
 unemployed, underemployed or in low-income jobs.
 2.  Microenterprises  provide a means for unemployed, underemployed or
 low-income individuals to find and sustain  productive  work,  and  they
 provide opportunities for economically distressed communities to thrive.
 3.  Low-income microentrepreneurs lack access to capital, training and
 technical assistance. Many low-income  microentrepreneurs  need  lending
 services  and  technical  assistance  to  start, operate or expand their
 businesses.
 4. Local microenterprise support organizations have demonstrated cost
 effective delivery methods for providing lending services and  technical
 assistance.
 5.  Charitable foundation support, federal program funding and private
 sector support can be leveraged by a statewide program  for  development
 of microenterprises.
 (b)  The  purpose  of  this act is to strengthen the state economy and
 enable low-income residents to  become  self-sufficient  by  encouraging
 microenterprise development.
 

S  3.  The economic development law is amended by adding a new article
 9-B to read as follows:

 ARTICLE 9-B
 MICROENTERPRISE DEVELOPMENT
 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
 [ ] is old law to be omitted.
 LBD04143-01-3
 
       S. 1224                             2
 SECTION 217. MICROENTERPRISE DEVELOPMENT.
 

S  217.  MICROENTERPRISE DEVELOPMENT. (A) AS USED IN THIS SECTION, THE
 FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEANINGS:

 1. "COMMISSIONER" MEANS THE COMMISSIONER OF THE DEPARTMENT OF ECONOMIC
 DEVELOPMENT.
 2. "MICROENTERPRISE" MEANS  A  SOLE  PROPRIETORSHIP,  PARTNERSHIP,  OR
 CORPORATION  THAT  HAS  FEWER  THAN  FOUR  EMPLOYEES AND GENERALLY LACKS
 ACCESS TO CONVENTIONAL LOANS, EQUITY, OR OTHER BANKING SERVICES.
 3.  "MICROENTERPRISE  DEVELOPMENT  ORGANIZATION"  OR  "MICROENTERPRISE
 DEVELOPMENT  PROGRAM" MEANS A NONPROFIT ENTITY OR A PROGRAM ADMINISTERED
 BY SUCH AN ENTITY, INCLUDING COMMUNITY DEVELOPMENT CORPORATIONS OR OTHER
 NONPROFIT DEVELOPMENT ORGANIZATIONS AND  SOCIAL  SERVICE  ORGANIZATIONS,
 THAT PROVIDES SERVICES TO LOW-INCOME MICROENTERPRISES.
 4.  "TRAINING  AND  TECHNICAL  ASSISTANCE"  MEANS SERVICES AND SUPPORT
 PROVIDED TO LOW-INCOME OWNERS AND OPERATORS OF MICROENTERPRISES, SUCH AS
 ASSISTANCE FOR THE PURPOSE OF  ENHANCING  BUSINESS  PLANNING,  MARKETING
 MANAGEMENT,  FINANCIAL MANAGEMENT SKILLS, AND ASSISTANCE FOR THE PURPOSE
 OF ACCESSING FINANCIAL SERVICES.
 5. "LOW-INCOME PERSON" MEANS A PERSON WITH INCOME ADJUSTED FOR  FAMILY
 SIZE THAT DOES NOT EXCEED:

 A. FOR METROPOLITAN AREAS, EIGHTY PERCENT OF MEDIAN INCOME; OR
 B.  FOR  NONMETROPOLITAN  AREAS,  THE GREATER OF EIGHTY PERCENT OF THE
 AREA MEDIAN INCOME OR EIGHTY PERCENT OF  THE  STATEWIDE  NONMETROPOLITAN
 AREA MEDIAN INCOME.
 (B)  1.  THE  COMMISSIONER SHALL ESTABLISH A MICROENTERPRISE TECHNICAL
 ASSISTANCE AND CAPACITY BUILDING GRANT PROGRAM, WHICH SHALL  RECEIVE  AN
 ANNUAL  APPROPRIATION  FROM  THE LEGISLATURE OF NO LESS THAN ONE MILLION
 DOLLARS, TO PROVIDE ASSISTANCE IN THE FORM OF GRANTS TO  MICROENTERPRISE
 DEVELOPMENT ORGANIZATIONS.
 2.  A  MICROENTERPRISE  DEVELOPMENT ORGANIZATION SHALL USE GRANTS MADE
 UNDER THIS PROGRAM TO PROVIDE TRAINING AND TECHNICAL ASSISTANCE TO  LOW
 INCOME ENTREPRENEURS OPERATING MICROENTERPRISES.
 3.  THE  COMMISSIONER SHALL ENSURE THAT NOT LESS THAN FIFTY PERCENT OF
 THE FUNDS MADE AVAILABLE ARE  USED  TO  BENEFIT  PERSONS  WHOSE  INCOME,
 ADJUSTED  FOR FAMILY SIZE, IS NOT MORE THAN ONE HUNDRED FIFTY PERCENT OF
 THE POVERTY LINE AS DEFINED IN 42 U.S.C. 9902(2).
 4. A MICROENTERPRISE DEVELOPMENT ORGANIZATION MUST  PROVIDE  AT  LEAST
 ONE DOLLAR IN MATCHING FUNDS FOR EVERY DOLLAR OF STATE FINANCIAL ASSIST
 ANCE. FEES, GRANTS, AND GIFTS FROM PUBLIC OR PRIVATE SOURCES MAY BE USED
 TO COMPLY WITH THE MATCHING FUNDS REQUIREMENT.
 5. THE COMMISSIONER SHALL ESTABLISH BY REGULATION SUCH REQUIREMENTS AS
 MAY BE NECESSARY TO CARRY OUT THE PROVISIONS OF THIS SECTION.
 

S   4.   The   sum  of  one  million  five  hundred  thousand  dollars
 ($1,500,000), or so much thereof as may be necessary, is  hereby  appro
 priated  to  the department of economic development out of any moneys in
 the state treasury in the general  fund  to  the  credit  of  the  state
 purposes  account,  not  otherwise  appropriated,  and  made immediately
 available, for the purpose of carrying out the provisions of  this  act.
 Such moneys shall be payable on the audit and warrant of the comptroller
 on vouchers certified or approved by the commissioner of economic devel
 opment, or his or her designee, in the manner prescribed by law.
 

S  5.  This act shall take effect on the first of July next succeeding
 the date on which it shall have become a law.

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