H. B. 3155
(By Delegates Campbell, White and Kominar)
[Introduced March 16, 2009; referred to the
Committee on Energy, Industry and Labor, Economic Development and
Small Business then the Judiciary.]
A BILL to amend and reenact §12-1A-4 and §12-1A-6 of the Code of
West Virginia, 1931, as amended; and to amend said code by
adding thereto two new sections, designated §12-1A-7 and
§12-1A-8, all relating to the renewal of the West Virginia
Small Business Linked Deposit Program; limiting liability of
certain state agencies; penalties for violation; and updating
certain language within the code.
Be it enacted by the Legislature of West Virginia:
That §12-1A-4 and §12-1A-6 of the Code of West Virginia, 1931,
as amended, be amended and reenacted; and that said code be amended
by adding thereto two new sections, designated §12-1A-7 and
§12-1A-8, all to read as follows:
ARTICLE 1A. WEST VIRGINIA SMALL BUSINESS LINKED DEPOSIT PROGRAM.
§12-1A-4. Applications for loan priority; loan package; counseling.
(a) An eligible lending institution that desires to
participate in the linked deposit program shall accept and review
loan applications from eligible small businesses that have been
prepared with the advice of the Small Business Development Center.
The lending institution shall apply all usual lending standards to
determine the credit worthiness of each eligible small business and
whether the loan application meets the criteria established in this
article.
(b) An eligible small business shall certify on its loan
application that: (1) The small business is in good standing with
the State Tax Division,
the Workers' Compensation Commission and
the Bureau of Employment Programs an authorized workers'
compensation insurance carrier and WORKFORCE West Virginia as of
the date of the application; (2) the linked deposit loan will be
used to create new jobs or preserve existing jobs and employment
opportunities; and (3) the linked deposit loan shall not be used to
refinance an existing debt.
(c) In considering which eligible small businesses should
receive linked deposit loans, the eligible lending institution
shall give priority to the economic needs of the area in which the
business is located, the number of jobs to be created and preserved
by the receipt of the loan, the reasonable ability of the small
business to repay the loan and other factors considered appropriate by the eligible financial institution.
(d) A small business receiving a linked deposit loan shall
receive supervision and counseling provided by the small business
development center when applying for the loan. The services
available from the Small Business Development Center include
eligibility certification, business planning, quarterly financial
statement review and loan application assistance. The State Tax
Division,
the Bureau of Employment Programs and the Workers'
Compensation Commission WORKFORCE West Virginia and the authorized
workers' compensation insurance carrier shall provide the Small
Business Development Center with information as to the standing of
each small business loan applicant. The Small Business Development
Center shall include these certifications with the loan
application.
(e) After all approvals of the Small Business Development
Center and the financial institution have been given for a linked
deposit loan, the Small Business Development Center and the
financial institution shall forward to the Treasurer a linked
deposit loan request in the form and manner prescribed by the
Treasurer. The Treasurer shall notify the Small Business
Development Center when the linked deposit is made.
§12-1A-6. Certification and monitoring of compliance;
accountability and reporting.
(a) Upon the placement of a linked deposit with an eligible lending institution, the institution shall lend the funds to the
approved eligible small business listed in the linked deposit loan
package. A certification of compliance with this section shall be
sent to the Small Business Development Center by the eligible
lending institution.
(b) As a condition of remaining in good standing with the
lending institution and the state and as a condition of having the
loan for up to seven years, the loan recipient shall receive
supervision and counseling provided by the Small Business
Development Center. Eligible small businesses shall also grant the
lending institution the right to provide information on the status
of the loan to the Small Business Development Center so as to
assist the small business.
(c) The Small Business Development Center shall take any and
all steps necessary to implement, advertise and monitor compliance
with the linked deposit program.
(d) By January 31 of each year, the Small Business Development
Center shall report on the linked deposit program for the preceding
calendar year to the West Virginia Development Office, which shall
then report to the Joint Committee on Government and Finance. The
reports shall set forth the name of the small business, terms,
delinquency and default rates, job growth, gross income evaluation
and amounts of the loans upon which the linked deposits were based.
§12-1A-7. Liability of state.
The state, the Treasurer, the Department of Commerce, the West
Virginia Development Office and the Small Business Development
Center and their employees are not liable to any eligible lending
institution in any manner for payment of the principal or interest
on the loan to an eligible small business. Any delay in payment or
default on the part of an eligible small business does not in any
manner affect the deposit agreement between the eligible lending
institution and the Treasurer.
§12-1A-8. Penalties for violation of article.
(a) Any person who knowingly makes a false statement
concerning an application or violates another provision of this
article is guilty of a misdemeanor and, upon conviction thereof,
shall be fined not less than $100 nor more than $500 or confined in
jail not less than one month nor more than one year.
(b) In addition to the criminal penalties provided in this
section, no person who is convicted of a violation of subsection
(a) of this section is eligible to participate in the linked
deposit program.
NOTE: The purpose of this bill is to limit liability of
certain state agencies, penalties for violation and updating
certain language within the code.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.