ARTICLE
24 AS AMENDED
RELATING TO
ECONOMIC DEVELOPMENT
SECTION 1.
Section 1 of Chapter 26 of the 2010 Public Laws entitled "AN ACT
RELATING TO ECONOMIC
DEVELOPMENT" is hereby repealed.
SECTION 1. WHEREAS, The Rhode Island Economic
Development Corporation was
created by the general assembly pursuant to chapter 64 of title
42 of the general laws in order to,
among other things, promote the retention and expansion of
businesses and the creation of jobs in
Rhode Island; and
WHEREAS,
One of the methods utilized by the Rhode Island Economic Development
Corporation to help promote and expand businesses in
corporation powers to issue bonds and debt and guarantees of
debt; and
WHEREAS,
other ill effects from the most recent national recession;
and
WHEREAS,
One of Rhode Island's economic development's strategies of continuing to
optimize its knowledge economy assets such, as the sciences,
technology, digital media,
innovative manufacturing and other technologies, requires
adequate access to capital; and
WHEREAS,
obtain reasonable credit without access to credit
enhancement; and
WHEREAS,
The Rhode Island Economic Development Corporation desires to create a
loan guarantee and bond program pursuant to which it will
be able to guarantee loan repayments
either directly or through the issuance of its bonds in
order to induce lending to companies
growing their employment in
WHEREAS,
The Rhode Island Economic Development Corporation seeks to have
authority pursuant to chapter 18 of title 35 of the general
laws to guarantee debts or otherwise
issue its bonds for this purpose not to exceed one hundred
twenty five million dollars
($125,000,000) in the aggregate of unpaid principal,
thereby limiting the contingent long-term
cost of such program to the state; and
WHEREAS,
The Rhode Island Economic Development Corporation requests the
approval of the general assembly prior to undertaking such
program; now, therefore be it
RESOLVED,
That the Rhode Island Economic Development Corporation (the
"corporation") is
hereby empowered and authorized pursuant to chapter 18, title 35 of the general
laws, and notwithstanding any provisions of chapter 64,
title 42 of the general laws to the
contrary, to create the corporation's Job Creation Guaranty
Program (the "program"). Under the
program, the corporation may from time to time issue its
bonds, guaranty debt service thereon or
on bonds issued by the
of another provided that the principal amount of bonds
or other obligations guaranteed pursuant
to the program shall not at any time exceed one hundred
twenty-five million dollars
($125,000,000). The guaranty of any bond or other obligation may
extend to repayment of the
principal thereof, sinking payments therefore, interest
thereon, and payment of any redemption
price or premium in connection with the redemption thereof
prior to maturity;
RESOLVED,
That guaranties or bonds issued by the corporation
shall be approved by its
board of directors, or a committee of the board as so
designated by the board, and shall be
executed by its executive director or any authorized officer
of the corporation as authorized in a
resolution approved by the board of directors of the corporation
from time to time in a form the
corporation may prescribe. The board of directors of the
corporation in authorizing any such
guaranty or bond obligations shall consider and be guided by
the following objectives:
(a)
Priority will be given to projects that promptly create permanent, full-time
jobs with
annual wages in excess of two hundred fifty percent (250%)
of the then current minimum wage
earned annually with industry comparable benefits. A
full-time job shall mean one in which the
employee works a minimum of thirty (30) hours per week within
this state.
(b) Any
guaranty or bond obligations hereby authorized should leverage capital
formation to facilitate business development with new and
existing companies that will create or
retain jobs in this state. The documentation reflecting
guaranty and bond obligations authorized
hereby shall contain adequate legal provisions for assuring
performance by the borrower of
creating and retaining new jobs within this state.
(c)
Priority shall be given to guarantees that align with the State’s economic
development
strategy to expand high-wage jobs in knowledge industry growth
clusters or with respect to assets
related thereto.
(d)
Guarantees or loan obligations from the program’s borrower will be
collateralized by
any and all available assets of the borrower and
guarantors, where applicable, including
subordinate collateral positions, cross collateralization with
other lenders and collateralized
guarantees as appropriate.
(e)
Insurances, including hazard and key person life, may be required where
appropriate.
(f) The
corporation may utilize such data and retain experts as necessary to assess and
validate associated guaranty risk, and the corporation may
charge borrower reasonable fees for
the corporation’s guaranty and reimbursement of expenses;
RESOLVED,
that in order assure any payments due on guarantees or
bond obligations
issued by the corporation in connection with the program
pursuant to this authorization are made,
to assure the continued operation and solvency of the
corporation for the carrying out of its
corporate purposes, and except as otherwise set forth in these
authorizing resolutions in
accordance with the provisions of chapter 64, title 42 of the
general laws: (i) The corporation
shall create a reserve fund from which shall be charged any
and all expenses of the corporation
with respect to guarantee or bond obligations of the
corporation pursuant to these resolutions
resulting from a program borrower’s default; and (ii) The
corporation shall credit to the reserve
fund no less than fifty percent (50%) of all program
receipts of the corporation including guaranty
fees, premiums and any other receipts or recoveries from
collections received pursuant to the
corporation’s rights to recover payments as a guarantor; and (iii)
To the extent the corporation’s
obligations as a guarantor or pursuant to its program bond
obligations are not satisfied by
amounts in its guaranty reserve fund, the executive director
of the corporation shall annually, on
or before December 1st, make and deliver to the governor
a certificate stating the minimum
amount, if any, required for the corporation to make
payments due on such guarantees. During
each January session of the general assembly, the governor
shall submit to the general assembly,
as part of the governor’s budget, the total of such
sums, if any, required to pay any and all
obligations of the corporation under such guarantees or bond
obligations pursuant to the terms of
this authorization. All sums appropriated by the general
assembly for that purpose, and paid to the
corporation, if any, shall be utilized by the corporation to make
payments due on such guarantees
or bond obligations. Any recoveries by the corporation
of guarantee payments are to be returned
to the guarantee reserve fund and utilized to reduce any
obligation of the state pursuant to any
guarantees entered into by the corporation;
RESOLVED,
on or before January 1 of each year, the corporation shall issue a report on
all guarantees issued by the corporation pursuant to this
authorization. The report shall include at
a minimum: a list of each guarantee issued; a
description of the borrower on behalf of which the
guarantee was issued; the lender or lenders that made the loan,
and the amount of such loan, to
such borrower; the amount of principal and interest on
each such loan outstanding as of the date
of such report; a summary of the collateral securing the
repayment of such loan for which the
guarantee was issued; and a summary of the economic impacts
made by such borrower as a result
of the guaranteed loan, including but not limited to the
number, type and wages of jobs created by
such borrower, any impacts on the industry in which the
borrower operates and an estimate of
income taxes for the state of
borrower itself.
SECTION 2.
Section 1 of Chapter 29 of the 2010 Public Laws entitled “AN ACT
RELATING TO AUTHORIZING THE
ECONOMIC DEVELOPMENT CORPORATION TO
CREATE THE JOB CREATION
GUARANTY PROGRAM” is hereby repealed.
SECTION 1. WHEREAS, The Rhode Island Economic
Development Corporation was
created by the general assembly pursuant to chapter 64 of
title 42 of the general laws in order to,
among other things, promote the retention and expansion of
businesses and the creation of jobs in
Rhode Island; and
WHEREAS,
One of the methods utilized by the Rhode Island Economic Development
Corporation to help promote and expand businesses in
quasi-public corporation powers to issue bonds and debt and
guarantees of debt; and
WHEREAS,
other ill effects from the most recent national recession;
and
WHEREAS,
One of Rhode Island's economic development's strategies of continuing to
optimize its knowledge economy assets such, as the sciences,
technology, digital media,
innovative manufacturing and other technologies, requires
adequate access to capital; and
WHEREAS,
obtain reasonable credit without access to credit
enhancement; and
WHEREAS,
The Rhode Island Economic Development Corporation desires to create a
loan guarantee and bond program pursuant to which it will be
able to guarantee loan repayments
either directly or through the issuance of its bonds in
order to induce lending to companies
growing their employment in
WHEREAS,
The Rhode Island Economic Development Corporation seeks to have
authority pursuant to chapter 18 of title 35 of the general
laws to guarantee debts or otherwise
issue its bonds for this purpose not to exceed one hundred
twenty five million dollars
($125,000,000) in the aggregate of unpaid principal,
thereby limiting the contingent long-
term Cost of such program to the state; and
WHEREAS,
The Rhode Island Economic Development Corporation requests the
approval of the general assembly prior to undertaking such
program; now, therefore be it
RESOLVED,
That the Rhode Island Economic Development Corporation (the
"corporation") is
hereby empowered and authorized pursuant to chapter 18, title 35 of the general
laws, and notwithstanding any provisions of chapter 64,
title 42 of the general laws to the
contrary, to create the corporation's Job Creation Guaranty
Program (the "program"). Under the
program, the corporation may from time to time issue its
bonds, guaranty debt service thereon or
on bonds issued by the
of another provided that the principal amount of bonds
or other obligations guaranteed pursuant
to the program shall not at any time exceed one hundred
twenty-five million dollars
($125,000,000). The guaranty of any bond or other obligation may
extend to repayment of the
principal thereof, sinking payments therefore, interest
thereon, and payment of any redemption
price or premium in connection with the redemption thereof
prior to maturity;
RESOLVED,
That guaranties or bonds issued by the corporation
shall be approved by its
board of directors, or a committee of the board as so
designated by the board, and shall be
executed by its executive director or any authorized officer
of the corporation as authorized in a
resolution approved by the board of directors of the corporation
from time to time in a form the
corporation may prescribe. The board of directors of the
corporation in authorizing any such
guaranty or bond obligations shall consider and be guided by
the following objectives:
(a)
Priority will be given to projects that promptly create permanent, full-time
jobs with
annual wages in excess of two hundred fifty percent (250%)
of the then current minimum wage
earned annually with industry comparable benefits. A full-time
job shall mean one in which the
employee works a minimum of thirty (30) hours per week within
this state.
(b) Any
guaranty or bond obligations hereby authorized should leverage capital
formation to facilitate business development with new and existing
companies that will create or
retain jobs in this state. The documentation reflecting
guaranty and bond obligations authorized
hereby shall contain adequate legal provisions for assuring
performance by the borrower of
creating and retaining new jobs within this state.
(c)
Priority shall be given to guarantees that align with the State’s economic
development
strategy to expand high-wage jobs in knowledge industry growth
clusters or with respect to assets
related thereto.
(d)
Guarantees or loan obligations from the program’s borrower will be
collateralized by
any and all available assets of the borrower and
guarantors, where applicable, including
subordinate collateral positions, cross collateralization with
other lenders and collateralized
guarantees as appropriate.
(e)
Insurances, including hazard and key person life, may be required where
appropriate.
(f) The
corporation may utilize such data and retain experts as necessary to assess and
validate associated guaranty risk, and the corporation may
charge borrower reasonable fees for
the corporation’s guaranty and reimbursement of expenses;
RESOLVED,
that in order assure any payments due on guarantees or
bond obligations
issued by the corporation in connection with the program
pursuant to this authorization are made,
to assure the continued operation and solvency of the
corporation for the carrying out of its
corporate purposes, and except as otherwise set forth in these
authorizing resolutions in
accordance with the provisions of chapter 64, title 42 of the
general laws: (i) The corporation
shall create a reserve fund from which shall be charged any
and all expenses of the corporation
with respect to guarantee or bond obligations of the
corporation pursuant to these resolutions
resulting from a program borrower’s default; and (ii) The
corporation shall credit to the reserve
fund no less than fifty percent (50%) of all program
receipts of the corporation including guaranty
fees, premiums and any other receipts or recoveries from
collections received pursuant to the
corporation’s rights to recover payments as a guarantor; and (iii)
To the extent the corporation’s
obligations as a guarantor or pursuant to its program bond
obligations are not satisfied by
amounts in its guaranty reserve fund, the executive director
of the corporation shall annually, on
or before December 1st, make and deliver to the governor
a certificate stating the minimum
amount, if any, required for the corporation to make
payments due on such guarantees. During
each January session of the general assembly, the governor
shall submit to the general assembly,
as part of the governor’s budget, the total of such
sums, if any, required to pay any and all
obligations of the corporation under such guarantees or bond
obligations pursuant to the terms of
this authorization. All sums appropriated by the general
assembly for that purpose, and paid to the
corporation, if any, shall be utilized by the corporation to make
payments due on such guarantees
or bond obligations. Any recoveries by the corporation
of guarantee payments are to be returned
to the guarantee reserve fund and utilized to reduce any
obligation of the state pursuant to any
guarantees entered into by the corporation;
RESOLVED,
on or before January 1 of each year, the corporation shall issue a report on
all guarantees issued by the corporation pursuant to this
authorization. The report shall include at
a minimum: a list of each guarantee issued; a
description of the borrower on behalf of which the
guarantee was issued; the lender or lenders that made the loan,
and the amount of such loan, to
such borrower; the amount of principal and interest on
each such loan outstanding as of the date
of such report; a summary of the collateral securing the
repayment of such loan for which the
guarantee was issued; and a summary of the economic impacts
made by such borrower as a result
of the guaranteed loan, including but not limited to the
number, type and wages of jobs created by
such borrower, any impacts on the industry in which the
borrower operates and an estimate of
income taxes for the state of
borrower itself.
SECTION 3. This article shall take effect upon passage.