Wyoming enterprise fund.

WORKING DRAFT
2005
STATE OF WYOMING
05LSO-0697.E1

HOUSE BILL
NO.
HB0346

Wyoming enterprise fund.

Sponsored by:
Representative(s) Simpson, Cohee, Luthi and Quarberg

A BILL

for

AN ACT relating to a business enterprise program; creating a loan and business management assistance program; specifying criteria for the program; providing for administration; providing an appropriation and a continuous appropriation of funds; and providing for an effective date.

Be It Enacted by the Legislature of the State of Wyoming:

Section 1.
W.S. 9
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12
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402 through 9
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12
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407 are created to read:

ARTICLE 4
WYOMING ENTERPRISE PROGRAM

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402.

Definitions.

(a)

As used in this article:

(i)

"Administrator" means the certified community development financial institution providing professional services under contract with the council to administer the program under this article;

(ii)

"Certified community development financial institution" means a nongovernmental organization certified by the United States department of treasury whose purpose is community development and which engages in financing and development activities, such as training and technical assistance for businesses;

(iii)

"Economic development account" means as defined by W.S. 9
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12
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301(a)(ii).

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403.

Wyoming enterprise program; account created; administration of account.

(a)

There is established a "Wyoming enterprise account" within the economic development account to provide loans under this article.

(b)

The council shall establish and oversee a Wyoming enterprise loan program and shall contract for necessary professional services to administer the program. In contracting for administration of the program, the council shall establish a range of interest rates and other terms allowable to be established in administration of the program. The program shall provide for loans and management assistance to businesses unable to obtain conventional credit. Loans and assistance authorized under the program shall be limited to businesses as defined in W.S. 9
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301(a)(i). The range of interest rates and other terms allowable shall be established in recognition of the economic development purposes of the program and repayment abilities and needs of businesses eligible for loans under the program.

(c)

The administrator of the program shall maintain an office in this state. The administrator shall seek federal and private funds to supplement state loan funds made under the program.

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404.

Actions on loan applications.

All complete applications to participate in the loan program established under this article which are submitted to the administrator and conform with the criteria established by law and rules promulgated under this article shall be considered. The administrator shall establish an application process, a loan approval process, loan amortization schedules, terms and conditions for each loan approved, interest rates, and other pertinent policies and procedures all of which shall take into account the economic development purposes of the program and repayment abilities and needs of businesses eligible for loans under the program.

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405.

Criteria for loans.

(a)

Loans or loan commitments or any combination thereof shall be made under this article only:

(i)

If there are sufficient funds in the enterprise account to fully fund it and all other outstanding commitments and loans;

(ii)

If funds provided by the state are adequately collateralized or risks are sufficiently mitigated. The adequacy of the collateral policy shall be determined by the administrator subject to approval of the council.

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406.

Wyoming enterprise account; deposits; continuous appropriation; loans.

The administrator shall receive funding under the program designated to be used only for loans and other funds for costs of administration and management assistance to businesses. All repayments of principal and interest of loans under the program shall be made directly to the administrator who shall be responsible for collections. The Wyoming enterprise account is continuously appropriated to the council to be expended solely for the purpose of providing loans under this article. At the end of the contract period, the council shall collect all loan repayments received by the administrator under the program and deposit those funds into the Wyoming enterprise account. The total principal balance of outstanding loans shall not exceed the amounts appropriated by the legislature plus interest accrued and collected less any losses of loan principal or interest.

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407.

Audit; report.

(a)

The director of the state department of audit or his designee shall annually examine the loan program created under this article and submit his report of examination to the governor, the legislature and the council. This examination shall include a financial and compliance audit of the council's operations, and such financial audit of borrowers under this article as the examiner deems appropriate. As a condition of any loan under this article, the borrower shall agree to allow the examiner to examine its books and records. The examiner shall treat all proprietary information received in the course of the examination or audit as confidential.

(b)

On or before July 15 of each year, the council shall submit a written report to the joint minerals, business and economic development interim committee reviewing rules adopted by the council during the reporting period, presenting a portfolio of loans made under the program and presenting a risk analysis of the portfolio of loans prepared by the state banking commissioner. The report, portfolio of loans and risk analysis required under this subsection shall be public records. The risk analysis prepared by the state banking commissioner shall not be subject to the limitations of W.S. 9
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512.

Section 2.
W.S. 9
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122(a) by creating a new paragraph (v) and 9
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307 are amended to read:

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112.

Annual report and budget.

(a)

The council shall submit an annual report in the manner provided by W.S. 9
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1014 and using the benchmarks prescribed in this act. In addition to the requirements of W.S. 9
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1014, included within the annual report shall be:

(v)

A summary of the total investments made by the council under the Wyoming enterprise loan program, article 4 of this chapter, including:

(A)

The name of each borrower and the amount of each loan;

(B)

An evaluation of the loan success in economic development using appropriate performance indicators as identified by the council;

(C)

The cost of the loan program to the people of Wyoming in terms of:

(I)

Forgone interest that could have been obtained if the funds had been invested by the state treasurer with the permanent funds of the state;

(II)

Administrative and other costs associated with the program.

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307.

Penalty.

Any person who knowingly makes a false statement to the council in connection with an application under this article or
who violates W.S. 9
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302(c)
article 4 of this chapter
is guilty of a felony punishable by imprisonment for not more than two (2) years, a fine of not more than two thousand dollars ($2,000.00), or both.

Section 3
. There is appropriated from the general fund to the Wyoming business council two hundred ninety-four thousand five hundred dollars ($294,500.00) for administration of the Wyoming enterprise loan program created by this act.
Section 4.
This act is effective immediately upon co
m
pletion of all acts necessary for a bill to become law as provided by Article 4, Section 8 of the Wyoming Constit
u
tion.

(END)

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HB0346