SECTIONS 8683-8684.2 - California Statutes

GOVERNMENT CODE

SECTION 8683-8684.2

8683. Whenever funds are available for purposes of this chapter,
the director shall make allocations therefrom in the amounts that he
or she determines to be necessary to state agencies for expenditure
for making the investigations, estimates, and reports required by
this chapter. Those allocations may also be made to provide for
preliminary investigations, estimates, reports, training of state
agency personnel, or to reimburse the state agencies for expenditures
made in anticipation of actual applications by local agencies.
Allocations may also be made for the purpose of making any
investigations, estimates, and reports that may be necessary to
enable local agencies to obtain federal aid for disaster relief
purposes, regardless of whether or not that aid is available for
projects that are eligible for state allocations pursuant to this
chapter. The director may make allocations to any state agency or
office from those funds, or other funds available therefor, in the
amounts that are necessary to administer this chapter.

8684.2. (a) It is the intent of the Legislature:
(1) To provide the Governor with appropriate emergency powers in
order to enable utilization of available emergency funding to provide
guarantees for interim loans to be made by lending institutions, in
connection with relief provided for those persons affected by
disasters or a state of emergency in affected areas during periods of
disaster relief assistance, for the purpose of supplying interim
financing to enable small businesses to continue operations pending
receipt of federal disaster assistance.
(2) That the Governor should utilize this authority to prevent
business insolvencies and loss of employment in areas affected by
these disasters.
(b) In addition to the allocations authorized by Section 8683 and
the loan guarantee provisions of Section 14030.1 of the Corporations
Code, the Governor may allocate funds made available for the purposes
of this chapter, in connection with relief provided, in affected
areas during the period of federal disaster relief, to the Small
Business Expansion Fund for use by the Office of Small Business,
pursuant to Chapter 1 (commencing with Section 14000) of Part 5 of
Division 3 of Title 1 of the Corporations Code, to provide guarantees
for low-interest interim loans to be made by lending institutions
for the purpose of providing interim financing to enable small
businesses that have suffered actual physical damage or significant
economic losses, as a result of the disaster or state of emergency
for which funding under this section is made available, to continue
or resume operations pending receipt of loans made or guaranteed by
the federal Small Business Administration. The maximum amount of any
loan guarantee funded under this paragraph shall not exceed two
hundred thousand dollars ($200,000). Each loan guarantee shall not
exceed 95 percent of the loan amount, except that a loan guarantee
may be for 100 percent of the loan amount if the applicant can
demonstrate that access to business records pertinent to the loan
application has been precluded by official action prohibiting
necessary reentry into the affected business premises or that those
business records pertinent to the loan application have been
destroyed. The term of the loan shall be determined by the lending
institution providing the loan or shall be made payable on the date
the proceeds of a loan made or guaranteed by the federal Small
Business Administration with respect to the same damage or loss are
made available to the borrower, whichever event first occurs.
(c) Loan guarantees for which the initial 12-month term has
expired and for which an application for disaster assistance funding
from the federal Small Business Administration is still pending may
be extended until the Small Business Administration has reached a
final decision on the application. Applications for interim loans
shall be processed in an expeditious manner. Wherever possible,
lending institutions shall fund nonconstruction loans within 60
calendar days of application. Loan guarantees for loans that have
been denied funding by the federal Small Business Administration, may
be extended by the financial institution provided that the loan is
for no longer than a maximum of seven years, if the business
demonstrates the ability to repay the loan with an extended loan
term, and a new credit analysis is provided. All loans extended under
this provision shall be repaid in installments of principal and
interest, and be fully amortized over the term of the loan. Nothing
in this section shall preclude the lender from charging reasonable
administrative fees in connection with the loan.
(d) Allocations pursuant to this section shall, for purposes of
all provisions of law, be deemed to be for extraordinary emergency or
disaster response operation costs, as provided in Section 8690.6,
incurred by state employees assigned to work on the financial
development corporation program.
(e) The Business, Transportation and Housing Agency may adopt
regulations to implement the loan guarantee program authorized by
this section. The agency may adopt these regulations as emergency
regulations in accordance with Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3, and for purposes of that chapter,
including Section 11349.6, the adoption of the regulations shall be
considered by the Office of Administrative Law to be necessary for
the immediate preservation of the public peace, health and safety,
and general welfare. Notwithstanding subdivision (e) of Section
11346.1, the regulations shall be repealed within 180 days after
their effective date unless the agency complies with Chapter 3.5
(commencing with Section 11340) of Part 1 of Division 3, as provided
in subdivision (e) of Section 11346.1.
(f) Within 60 days of the conclusion of the period for
guaranteeing loans under any small business disaster loan guarantee
program conducted for a disaster as authorized by Section 8684.2, or
Section 14075 of the Corporations Code, the agency shall provide a
report to the Legislature on loan guarantees approved and rejected by
gender, ethnic group, type of business and location, and each
participating loan institution.