Sec. 32-354. Micro-loan program for minority-owned businesses. - Connecticut Statutes

      Sec. 32-354. Micro-loan program for minority-owned businesses. (a) (1) There is established a micro-loan program for minority-owned businesses. The commissioner may enter into a contract with a quasi-public agency, financial institution or nonprofit corporation to provide for the administration and the state-wide promotion of the program. On or before July 1, 2001, the program shall be a self sustaining revolving loan fund. No loan or loan guarantee that is not in accordance with the provisions of such contract shall be made from the fund established under subdivision (2) of this subsection.

      (2) There is established a fund to be known as the "Micro-Loan Revolving Fund for Minority-Owned Businesses". The fund shall contain (A) any moneys allocated pursuant to subdivision (3) of this subsection, and (B) any moneys required by law to be deposited into the fund, including, but not limited to, any moneys appropriated by the state and interest payments and principal payments on loans. Any balance remaining in the fund at the end of any fiscal year shall be carried forward in the fund for the next succeeding fiscal year. The fund shall be used to make loans and loan guarantees pursuant to subsection (b) of this section and to pay reasonable and necessary expenses incurred in administering such loans and loan guarantees and the program established under this subsection.

      (3) The commissioner may allocate moneys from the Economic Assistance Revolving Fund, established under section 32-231, to the fund established under subdivision (2) of this subsection.

      (b) The state, acting by and in the discretion of the commissioner, may, pursuant to a contract entered into under subdivision (1) of subsection (a) of this section, provide funds to a quasi-public agency, financial institution or nonprofit corporation to be used by such quasi-public agency, financial institution or nonprofit corporation to make loans, interest-free loans, deferred loans or loan guarantees to minority-owned businesses. Any such loan or loan guarantee shall be used by the minority-owned business for business start-up costs or the day-to-day operation of the business. The proceeds from any loan made pursuant to this subsection shall not be used for the refinancing of existing loans.

      (c) The amount of any loan made pursuant to subsection (b) of this section shall not exceed fifty thousand dollars. The amount of any loan guarantee made pursuant to subsection (b) of this section shall not exceed thirty per cent of the principal amount.

      (d) Each minority-owned business applying for a loan or loan guarantee under subsection (b) of this section shall submit an application in such form and containing such information as the commissioner shall require. Security for such loan may include a security interest, an assignment of a lease or the subordination of a mortgage. In addition to any other conditions of default under such loan or loan guarantee, the minority-owned business shall be in default if such loan or loan guarantee is not used for the purposes set forth in subsection (b) of this section or if the minority-owned business fails to participate in the business management training program required under section 32-355.

      (e) Payments of principal and any interest on loans, interest-free loans and deferred loans made pursuant to subsection (b) of this section shall be deposited into the Micro-Loan Revolving Fund for Minority-Owned Businesses established under subdivision (2) of subsection (a) of this section.

      (f) The commissioner may adopt regulations, in accordance with chapter 54, to carry out the provisions of this section. Such regulations may provide for loan procedures, repayment terms, interest and security requirements, default and remedy provisions, and such other terms and conditions as the commissioner deems appropriate.

      (P.A. 99-208, S. 5; P.A. 01-10, S. 5.)

      History: P.A. 01-10 made a technical change in Subsec. (b).