2022 -- H 8031

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LC005503

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2022

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A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- RHODE ISLAND HARD-HIT

LIQUIDITY PROGRAM ACT

     Introduced By: Representatives Messier, Felix, Alzate, and Tobon

     Date Introduced: March 23, 2022

     Referred To: House Finance

     It is enacted by the General Assembly as follows:

     SECTION 1. Subject to the conditions, limitations and restrictions hereinafter contained in

this act, in addition to those monies previously appropriated pursuant to Chapter 162 of the Public

Laws of 2021, the sum of twenty million dollars ($20,000,000) is hereby appropriated to the

Commerce Corporation in addition to amounts previously appropriated and shall be paid out of

funds made available to the state from federal sources under the American Rescue Plan Act of 2021

not otherwise appropriated to be extended during the fiscal year ending June 30, 2022 to support

and fulfill the provisions of the Rhode Island Hard-Hit Emergency Liquidity Program created

pursuant to Section 2 of this Act. For the purposes and functions hereinafter mentioned, the state

controller is hereby authorized and directed to draw his or her orders upon the general treasurer for

the payment of such sums or such portions thereof as may be required from time to time upon

receipt by him or her of properly authenticated vouchers.

     SECTION 2. Title 42 of the General Laws entitled "STATE AFFAIRS AND

GOVERNMENT" is hereby amended by adding thereto the following chapter:

CHAPTER 162

RHODE ISLAND HARD-HIT EMERGENCY LIQUIDITY PROGRAM ACT

     42-162-1. Short title.

     This chapter shall be known and may be cited as the “Rhode Island Hard-Hit Emergency

Liquidity Program Act” or in short form the “RI HELP Act.”

     42-162-2. Purpose.

     The purpose of the RI HELP act program is to provide a special America Rescue Plan Act

of 2021, (ARPA), Publ. L. 117-2, fund for those hard-hit companies in industries which have not

received more than five hundred thousand dollars ($500,000) from other ARPA programs

administered by the state or the commerce corporation in response to the coronavirus pandemic

and who need additional funds to support operations to ensure that companies do not fail due to a

loss of liquidity from the single or repeated cessation and reopening of operations.

     42-162-3. Eligibility.

     Eligibility for aid to be provided pursuant to the provisions of this chapter shall be

determined based on an application filed with the commerce corporation with supporting financial

documentation. There shall be three (3) categories of eligible recipients of aid under the RI HELP

act:

     (1) Regular eligibility shall be open to all domestic registered entities and Rhode Island

residents operating non-registered businesses, such as sole-proprietorships, partnerships or

associations, with up to five million dollars ($5,000,000) in annual sales based on calendar 2019 or

FY 2019, as elected by the applicant, and who can show a drop in sales of at least thirty percent

(30%) in each month from July 2020 to June 2021 as compared to the corresponding months from

July 2018 to June 2019.

     (2) Program eligibility shall be open to those companies eligible under subsection (1) of

this section that can show a drop in monthly sales of at least fifty percent (50%) over the course of

at least three (3) months during the period from November 2020 to June 2021 as compared to the

corresponding months from November 2018 to June 2019.

     (3) With regard to companies operating in the travel industry including companies engaged

in travel, event and cultural activities that would otherwise qualify pursuant to the provisions of

subsections (1) or (2) of this section, but for the annual sales limitations above, there shall be no

limit on the size of the company based on annual sales revenue.

     42-162-4. Benefits to be provided.

     (a) Companies eligible under § 42-162-3 shall be eligible for different amounts of aid based

on the percentage loss in sales. The aid further shall be calculated based on the total “fixed costs”

paid over the course of a year. Each application shall declare how much the applicant pays in annual

fixed costs for the year which ended December 31, 2021 or June 30, 2022, at the election of the

applicant.

     (b) For the purposes of this section, “fixed costs” shall be defined as including, but not

being limited to:

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     (1) One hundred percent (100%) of costs for leases or rent payments for buildings, offices,

land, machinery, equipment, vehicles, and mortgage payments including all principal and interest

incurred for participation in the Main Street Lending Program established by the Federal Reserve

and terminated on January 8, 2021, and involuntary prepaid principal and interest payments,

property tax payments to a municipality, finance costs, insurance premiums, license fees, and costs

for personal protective equipment purchased by the company in connection with its operations or

for use by its employees, guests, or customers.

     (2) Twenty percent (20%) of employee costs for salaries and benefits not paid on a per

project or other temporary basis.

     (3) Any travel industry company, for the purposes of this section, “fixed costs” shall

include one hundred percent (100%) of lost tour operating margins and advertising and marketing

costs paid during the year ending December 31, 2021 or June 30 2022, as elected by the applicant.

"Lost tour operating margins" means the difference between the gross margins actually earned

during twelve (12) month period that ended December 31, 2021, or June 30, 2022, as elected by

the applicant and the comparable period ending in 2019.

     (c) For the calculation of aid based on losses in sales for all non-travel industry eligible

companies under § 42-162-3, aid shall be calculated as equal to:

     (1) One hundred percent (100%) of fixed costs if sales dropped more than seventy percent

(70%);

     (2) Sixty percent (60%) of fixed costs if sales dropped between fifty percent (50%) to

seventy percent (70%); or

     (3) Forty percent (40%) of fixed costs if sales dropped more than forty percent (40%) but

less than fifty percent (50%).

     (d) For the calculation of aid based on losses in sales for eligible companies under § 42-

162-3, the aid shall be increased as follows:

     (1) Twenty-five percent (25%) on total fixed reimbursement in the event of a decline in

sales of at least fifty percent (50%) in three (3) months;

     (2) Thirty-five percent (35%) if sales declined at least fifty percent (50%) in four (4)

months of the period; or

     (3) Forty percent (40%) surcharge if sales declined at least fifty percent (50%) in five (5)

or more months.

     (e) No applicant may receive more than ten million dollars ($10,000,000) under this

chapter.

     (f) In the event there is insufficient money appropriated to the program to support the

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benefit calculations, payments shall be made on a pro rata basis based on eligible aid to be paid to

all approved applicants who file their applications on or before June 1, 2022.

     42-162-5. Sunset.

     This chapter shall sunset upon the payment of all monies appropriated to support this

program, or one year after the end of the state of emergency declared under law related to the

coronavirus pandemic, or January 1, 2023 whichever is later.

     42-162-6. Severability.

     If any provision of this chapter or its application to any person, agency, or circumstances,

is held invalid by a court of competent jurisdiction, the remainder of the chapter and the application

of the provision to other persons, agencies, or circumstances, shall not be affected thereby. The

invalidity of any section or sections, or part of any section or sections, of this chapter shall not

affect the validity of the remainder of the chapter.

     SECTION 3. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- RHODE ISLAND HARD-HIT

LIQUIDITY PROGRAM ACT

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     This act would establish the “Rhode Island Hard-Hit Emergency Liquidity Program Act”

to provide up to twenty million dollars ($20,000,000) to businesses adversely affected by the

coronavirus pandemic by providing aid for drop in sales.

     This act would take effect upon passage.

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