The New York State Senate

 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   6420
 
                        2021-2022 Regular Sessions
 
                           I N  A S S E M B L Y
 
                              March 17, 2021
                                ___________
 
 Introduced  by  M.  of A. BICHOTTE HERMELYN, PEOPLES-STOKES -- read once
   and referred to the Committee on Economic Development
 
 AN ACT to amend the urban development corporation act,  in  relation  to
   allowing  businesses  to  use  funds  received  from  the minority and
   women-owned business development and lending program for  the  purpose
   of refinancing existing debt
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Subparagraph (vii) of paragraph (c)  of  subdivision  1  of
 section 16-c of section 1 of chapter 174 of the laws of 1968, constitut-
 ing  the  urban  development corporation act, as amended by section 1 of
 part AA of chapter 55 of the  laws  of  2014,  is  amended  to  read  as
 follows:
   (vii)  refinancing  of  debt  or  equity  invested in an enterprise or
 project, UNLESS THE CHAIRPERSON OF THE CORPORATION FINDS  THE  TERMS  OF
 THE ORIGINAL DEBT TO BE UNREASONABLE AS PROVIDED IN SUBPARAGRAPH (IX) OF
 PARAGRAPH (D) OF THIS SUBDIVISION.
   §  2. Subparagraphs (vii) and (viii) of paragraph (d) of subdivision 1
 of section 16-c of section 1 of chapter 174 of the laws of 1968, consti-
 tuting the urban development  corporation  act,  subparagraph  (vii)  as
 amended  and  subparagraph  (viii)  as  added by section 1 of part AA of
 chapter 55 of the laws of 2014, are amended and a new subparagraph  (ix)
 is added to read as follows:
   (vii)  establish a comprehensive technical assistance program in coop-
 eration with the department of economic development to assist  minority-
 and  women-owned  businesses and potential minority and women-entrepren-
 eurs; [and]
   (viii) notwithstanding any provision of law to the contrary, establish
 a minority- and women-owned business investment fund to provide critical
 financial support to foster the development of new  and  emerging  ideas
 and  products  of minority- and women-owned business enterprises as well

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD04791-01-1

 A. 6420                             2
 
 as to promote the long-term financial performance and success  of  early
 stage  enterprises  that  are  minority-  and women-owned start-ups. The
 selection of an eligible applicant and  beneficiary  companies  for  the
 minority-  and women-owned business investment fund shall be selected by
 the process established pursuant to subdivisions  two  through  four  of
 section  sixteen-u of this act. Minority- or women-owned business enter-
 prises who  participate  in  such  minority-  and  women-owned  business
 investment fund under this subdivision shall not be precluded from qual-
 ifying  for  any other assistance, grant or loan made available from the
 state[.]; AND
   (IX) PROVIDE FOR THE REFINANCING OF DEBT  OR  EQUITY  INVESTED  IN  AN
 ENTERPRISE  OR PROJECT, PROVIDED THAT THE CHAIRPERSON OF THE CORPORATION
 DETERMINES THE TERMS OF THE ORIGINAL DEBT TO BE UNREASONABLE. THE APPLI-
 CANT MUST SUBMIT A WRITTEN  JUSTIFICATION  TO  THE  CHAIRPERSON  OF  THE
 CORPORATION  FOR  EACH  LOAN  EXPLAINING  WHY THE CURRENT LOAN IS NOT ON
 REASONABLE TERMS. UNREASONABLE TERMS OF DEBT MAY  INCLUDE  BUT  ARE  NOT
 LIMITED TO:
   (1) A DEMAND OR BALLOON MATURITY FEATURE IN THE EXISTING NOTE;
   (2)  THE  CURRENT MATURITY IS NOT APPROPRIATE FOR THE ORIGINAL PURPOSE
 OF THE LOAN;
   (3) THE EXISTING DEBT BEING REFINANCED IS ON A  REVOLVING  LINE  OR  A
 CREDIT CARD;
   (4) THE INTEREST RATE IS DEEMED UNREASONABLE BY THE CORPORATION; OR
   (5) THE LOAN IS OVER-COLLATERALIZED.
   §  3.  This  act shall take effect on the ninetieth day after it shall
 have become a law. Effective immediately, the addition, amendment and/or
 repeal of any rule or regulation necessary  for  the  implementation  of
 this  act  on its effective date are authorized to be made and completed
 on or before such effective date.