Florida Senate - 2012                                    SB 1442
       
       
       
       By Senator Braynon
       
       
       
       
       33-01264-12                                           20121442__
    1                        A bill to be entitled                      
    2         An act relating to the Black Business Loan Program;
    3         amending s. 288.7102, F.S.; revising the
    4         recertification and audit periods for eligible
    5         recipients of the Black Business Loan Program;
    6         authorizing existing recipients to submit certain
    7         information to the Department of Economic Opportunity
    8         instead of financial audits under certain
    9         circumstances; authorizing recipients to redress audit
   10         findings within a specified period; providing term of
   11         and revising requirements for funding agreements
   12         between recipients and the department; revising the
   13         entities with whom the department must consult before
   14         adopting rules; revising limits on the use of funds
   15         for technical support to black business enterprises
   16         and direct administrative costs; conforming
   17         provisions; reenacting s. 288.7094(2), F.S., relating
   18         to black business investment corporations, to
   19         incorporate changes made by the act in a reference
   20         thereto; providing an effective date.
   21  
   22  Be It Enacted by the Legislature of the State of Florida:
   23  
   24         Section 1. Section 288.7102, Florida Statutes, is amended
   25  to read:
   26         288.7102 Black Business Loan Program.—
   27         (1) The Black Business Loan Program is established in the
   28  department, which shall annually certify eligible recipients for
   29  a period of 5 years, recertify existing eligible recipients once
   30  every 5 years, and subsequently disburse funds annually or as
   31  appropriated by the Legislature, through such eligible
   32  recipients, to black business enterprises that cannot obtain
   33  capital through conventional lending institutions but that could
   34  otherwise compete successfully in the private sector.
   35         (2) The department shall establish an application and
   36  annual certification process for entities seeking funds to
   37  participate in providing loans, loan guarantees, or investments
   38  in black business enterprises pursuant to the Florida Black
   39  Business Investment Act. The department shall process all
   40  applications and recertifications submitted by June 1 on or
   41  before July 31 of the same calendar year.
   42         (3) If the Black Business Loan Program is appropriated any
   43  funding in a fiscal year, the department shall distribute an
   44  equal amount of the appropriation, calculated as the total
   45  annual appropriation divided by the total number of program
   46  recipients certified on or before July 31 of that fiscal year.
   47         (4) To be eligible to receive funds and provide loans, loan
   48  guarantees, or investments under this section, a recipient must:
   49         (a) Be a corporation registered in the state.
   50         (b) For an existing recipient during the 1st through 4th
   51  years of the recipient’s recertification period, annually submit
   52  to the department a financial audit or compilation of the
   53  recipient’s financial statement information for the most
   54  recently completed fiscal year and a copy of the department’s
   55  most recent letter certifying the recipient as qualified for the
   56  award of funds.
   57         (c) For an existing recipient during the 5th year of the
   58  recipient’s recertification period, submit to the department a
   59  recertification application and a financial audit performed by
   60  an independent certified public accountant for the most recently
   61  completed fiscal year, which audit does not reveal any material
   62  weaknesses or instances of material noncompliance that the
   63  recipient does not substantially redress within 60 days after
   64  receipt of the audit report.
   65         (d)(c) For a new recipient:
   66         1. Demonstrate that its board of directors includes
   67  citizens of the state experienced in the development of black
   68  business enterprises.
   69         2. Demonstrate that the recipient has a business plan that
   70  allows the recipient to operate in a manner consistent with this
   71  section and the rules of the department.
   72         3. Demonstrate that the recipient has the technical skills
   73  to analyze and evaluate applications by black business
   74  enterprises for loans, loan guarantees, or investments.
   75         4. Demonstrate that the recipient has established viable
   76  partnerships with public and private funding sources, economic
   77  development agencies, and workforce development and job referral
   78  networks.
   79         5. Demonstrate that the recipient can provide a private
   80  match equal to 20 percent of the amount of funds provided by the
   81  department.
   82         (e)(d) For an existing or new recipient, agree to maintain
   83  the recipient’s books and records relating to funds received by
   84  the department according to generally accepted accounting
   85  principles and in accordance with the requirements of s.
   86  215.97(7) and to make those books and records available to the
   87  department for inspection upon reasonable notice.
   88         (5) Each eligible recipient must meet the requirements of
   89  this section, the terms of the agreement contract between the
   90  recipient and the department, and any other applicable state or
   91  federal laws. An entity may not receive funds unless the entity
   92  meets annual certification requirements.
   93         (6) Upon approval by the department and Before release of
   94  the funds as provided in this section, the department shall
   95  issue a letter certifying the eligible recipient applicant as
   96  qualified for an award. The department and the eligible
   97  recipient applicant shall enter into an annual agreement that
   98  sets forth the conditions for award of the funds. The term of
   99  any agreement between the department and an eligible recipient
  100  may not exceed 1 year. The agreement must include the total
  101  amount of funds awarded; the performance conditions that must be
  102  met once the funding is has been awarded, including, but not
  103  limited to, compliance with all of the requirements of this
  104  section for eligible recipients of funds under this section; and
  105  sanctions for failure to meet performance conditions, including
  106  any provisions to recover awards. The agreement may not require
  107  any reporting of or obligation for appropriated funds beyond the
  108  1-year term of the agreement, except that appropriated funds
  109  remaining unexpended at the end of the 1-year agreement must be
  110  reported until the funds are expended.
  111         (7) The department, in consultation with the presidents of
  112  the black business investment corporations board, shall adopt
  113  rules pursuant to ss. 120.536(1) and 120.54 to implement this
  114  section.
  115         (8) A black business investment corporation certified by
  116  the department as an eligible recipient under this section is
  117  authorized to use funds appropriated for the Black Business Loan
  118  Program in any of the following forms:
  119         (a) Purchases of stock, preferred or common, voting or
  120  nonvoting; however, no more than 40 percent of the funds may be
  121  used for direct investments in black business enterprises;
  122         (b) Loans or loan guarantees, with or without recourse, in
  123  either a subordinated or priority position; or
  124         (c) Administrative costs and technical support to black
  125  business enterprises, which combined may not to exceed 27 9
  126  percent of the funds received, and direct administrative costs,
  127  not to exceed 12 percent of the funds received.
  128         (9) It is the intent of the Legislature that if any one
  129  type of investment mechanism authorized in subsection (8) is
  130  held to be invalid, all other valid mechanisms remain available.
  131         (10) All loans, loan guarantees, and investments, and any
  132  income related thereto, shall be used to carry out the public
  133  purpose to develop black business enterprises. This subsection
  134  does not preclude a reasonable profit for the participating
  135  black business investment corporation or for return of equity
  136  developed to the state and participating financial institutions
  137  upon any distribution of the assets or excess income of the
  138  investment corporation.
  139         Section 2. For the purpose of incorporating the amendment
  140  made by this act to section 288.7102, Florida Statutes, in a
  141  reference thereto, subsection (2) of section 288.7094, Florida
  142  Statutes, is reenacted to read:
  143         288.7094 Black business investment corporations.—
  144         (2) A black business investment corporation that meets the
  145  requirements of s. 288.7102(4) is eligible to participate in the
  146  Black Business Loan Program and shall receive priority
  147  consideration by the department for participation in the
  148  program.
  149         Section 3. This act shall take effect July 1, 2012.