NY State Senate Bill 2011-S5782

Senate Bill S5782

Signed By Governor

2011-2012 Legislative Session

Relates to the capital access program; provides for a new technology seed fund

download bill text pdf

Archive: Last Bill Status - Signed by Governor

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jun 28, 2011	signed chap.103
Jun 21, 2011	delivered to governor
Jun 20, 2011	returned to senate passed assembly ordered to third reading rules cal.511 substituted for a8452 referred to ways and means delivered to assembly passed senate
Jun 17, 2011	ordered to third reading cal.1363 committee discharged and committed to rules
Jun 16, 2011	referred to finance

Votes

- Jun 20, 2011 - Floor Vote
  S5782
  
  62
  
  Aye
  
  0
  
  Nay
  
  0
  
  Absent
  
  0
  
  Excused
  
  0
  
  Abstained
  - - Floor Vote: Jun 20, 2011
      
      aye (62)
      
      Adams
      
      Addabbo Jr.
      
      Alesi
      
      Avella
      
      Ball
      
      Bonacic
      
      Breslin
      
      Carlucci
      
      DeFrancisco
      
      Diaz
      
      Dilan
      
      Duane
      
      Espaillat
      
      Farley
      
      Flanagan
      
      Fuschillo
      
      Gallivan
      
      Gianaris
      
      Golden
      
      Griffo
      
      Grisanti
      
      Hannon
      
      Hassell-Thompson
      
      Huntley
      
      Johnson
      
      Kennedy
      
      Klein
      
      Krueger
      
      Kruger
      
      LaValle
      
      Lanza
      
      Larkin
      
      Libous
      
      Little
      
      Marcellino
      
      Martins
      
      Maziarz
      
      McDonald
      
      Montgomery
      
      Nozzolio
      
      O'Mara
      
      Oppenheimer
      
      Parker
      
      Peralta
      
      Perkins
      
      Ranzenhofer
      
      Ritchie
      
      Rivera
      
      Robach
      
      Saland
      
      Sampson
      
      Savino
      
      Serrano
      
      Seward
      
      Skelos
      
      Smith
      
      Squadron
      
      Stavisky
      
      Stewart-Cousins
      
      Valesky
      
      Young
      
      Zeldin

2011-S5782 (ACTIVE) - Details

See Assembly Version of this Bill:: A8452
Law Section:: New York State Urban Development Corporation Act
Laws Affected:: Amd §16-k, add §16-u, UDC Act

2011-S5782 (ACTIVE) - Summary

Relates to the capital access program; provides for a new Innovate NY fund.

2011-S5782 (ACTIVE) - Sponsor Memo

                                BILL NUMBER:S5782

TITLE OF BILL:

An act
to amend the New York state urban development corporation act, in
relation to the capital access program and to provide for a new
Innovate NY
fund; and making appropriations for the
support of government

PURPOSE OF BILL:

This bill would amend New York State's Capital Access Program and
establish the Innovate NY Fund in order to make resources available to
support emerging business ideas and products that result in the
growth of business within New York State.

SUMMARY OF PROVISIONS:

Section 1 of the bill would amend New York State Urban Development
Corporation Act ("UDC Act") § 16-k to enhance the ability of small
businesses in New York State to access loan capital through the
State's existing Capital Access Program. The legislation would expand
the group of New York-based financial institutions that can
participate in the program by defining "financial institution" to

include a "community development financial institution or
community-based lending organization" that is based principally in New
York State.

Section 1 of the bill would also clarify that the purpose of the
Capital Access Program is to assist small businesses that otherwise
find it difficult to obtain regular or sufficient bank financing.
This section would also require the New York State Urban Development
Corporation doing business as Empire State Development (the
"Corporation") to assure adequate geographic distribution of
participating financial institutions throughout the State to the
extent feasible.

Finally, section 1 of the bill would authorize the Corporation to
contract with a third party financial institution to act as the
Corporation's agent in administering the Capital Access Program and
provide that the selection of any such third party agent other than
the New York Business Development Corporation would be made pursuant
to a competitive process.

Section 2 of this bill would amend the UDC Act by adding a new section
16-u that establishes the Innovate NY Fund.

Subdivision 1 of section 16-u states that the purpose of the Innovate
NY fund is to make available state funds to eligible applicants to
support emerging business ideas and products that result in the
growth of business within the state and the concomitant creation of
jobs and tax revenues for the State.


Subdivision 2 of section 16-u would provide that eligible applicants
for Innovate NY funds may include economic development organizations,
technology development organizations, research universities and
investment funds that provide seed-stage investments in New York
companies.

Subdivision 3 of section 16-u would establish the requirements for the
ultimate beneficiaries of an investment. These would include that the
entity must currently be, or will agree in writing to be, located
within the State; the entity must be in the seed-stage of development
as defined by the Corporation; and the entity must demonstrate a
potential for substantial growth and job development and have the
potential to generate additional economic activity in New York State.
This subdivision would provide that priority be given to companies
involved in commercialization of research and development or
high-tech manufacturing.

Subdivision 4 of section 16-u would provide for the Corporation to
establish a competitive process for receiving and evaluating
applications for the Innovate NY Fund. This subdivision would also
provide that the applications be evaluated based on certain criteria
and sets forth certain of those criteria. The subdivision states that
the Corporaticm is to assure that applicants demonstrate the need for
seed capital in the areas served and provide for adequate geographic
distribution of awards throughout the State to the extent feasible.
It would also require the Corporation to distribute funds promptly
pursuant to a disbursement process agreed to between the Corporation
and the applicant to enable the applicant to fulfill commitments to
beneficiary companies in a timely manner.

Subdivision 5 of section 16-u would require that investments of
Innovate NY funds in beneficiary companies be leveraged with private
sources of capital at a ratio equal to or greater than two to one
(2:1). The leveraged match would be met on an aggregate basis and
excludes investments after the initial funding round. Compliance with
the match requirement would be determined by the Corporation when the
applicant has invested fifty percent of the Innovate NY funds
committed to such applicant and annually thereafter.

Subdivision 6 of section 16-u would impose limitations on the amount
of Innovate NY funds that an applicant may invest in any single
beneficiary company.

Subdivision 7 of section 16-u would authorize the Corporation to
establish an Innovate NY program fund and to pay into such fund any
eligible resources available to the Corporation from any source,
including appropriations made by the State.

Subdivision 8 of section 16-u would require the Corporation to submit
a report annually on December 31 to the Director of the Budget, the
Temporary President of the Senate, the Speaker of the Assembly, the
Minority Leader of the Senate and the Minority Leader of the Assembly
providing information on investments made by, and the results
achieved through, the Innovate NY Fund.

Subdivision 9 of section 16-u would authorize the Corporation to
promulgate rules and regulations to implement this legislation,


including rules and regulations with respect to the
reasonable management and other fees and charges of applicants that
receive Innovate NY funds as well as the repayment of funds received
by a beneficiary company if the beneficiary company leaves the State
within a certain period of time to be determined by the Corporation.

Subdivision 10 of section 16-u would permit the Corporation to impose
fees, establish repayment terms and provide for equity participation
by the Corporation in connection with investments from the Innovate
NY Fund in accordance with rules and regulations to be promulgated by
the Corporation.

Subdivision 11 of section 16-u would exempt the Corporation from the
provisions of sections 10 and 16(2) of the UDC Act.

Section 3 of the bill would provide for an appropriation of the
federal monies received by the Department of Economic Development to
be paid to the Corporation to fund the Capital Access Program, the
Innovate NY Fund and the Corporation's Bonding Guarantee
Assistance Program.

Section 4 would make the bill effective immediately.

EXISTING LAW:

Section 16-k of the UDC Act provides for the current Capital Access
Program.

STATEMENT IN SUPPORT:

On September 27, 2010, President Obama signed into law the Small
Business Jobs Act of 2010 (the "Act") to help increase credit
availability for small businesses. The Act included the State Small
Business Credit Initiative ("SSBCI"), a $1.5 billion program
administered by the U.S. Department of the Treasury ("Treasury")
intended to provide direct support to states for use in programs
designed to increase access to credit for small businesses. Pursuant
to the Act, Treasury allocated funds to the states according to a
statutory formula. New York is eligible to receive approximately
$55.4 million and no state matching funds are required.

The SSBCI permits funding for two state program categories: capital
access programs ("CAPs") and other credit support programs ("OCSPs").
This bilI would allow New York State to employ a portion of its
federal SSBCI allocation in the State's existing Capital Access
Program. In addition, this bill would amend current law to make the
existing program more accessible to small businesses in New York State.

The existing Capital Access Program is inactive. This bill would
reinvigorate the Capital Access Program by strengthening the statute
governing its function and by providing for new funding. This would
greatly assist small businesses by enhancing the climate for lending
in traditional and alternative financial institutions.

In addition to funding the Capital Access Program, it is expected that
federal SSBCI resources will be used to fund the Corporation's
bonding guarantee assistance program. This


program will aid small businesses, including minority-owned and
women-owned firms, in obtaining the necessary bonding authority to
secure State contracts.

This bill would also establish the Innovate NY Fund. The Fund would
leverage federal SSBCI funding by providing funding to entities,
including regional and local economic development organizations,
technology development organizations, research universities and
investment funds, which would use the funding to make seed-stage
investments in New York State companies.

The Innovate NY Fund would invest approximately $25 million with firms
investing in seed-stage businesses in New York that have developed
cutting-edge breakthroughs in emerging technologies. To maximize the
effectiveness of available resources, an applicant seeking Innovate
NY funds would be evaluated based on a number of criteria. The
Innovate NY Fund, supported through an allocation of SSBCI federal
resources and appropriately leveraged with significant private
investment, would increase the State's ability to make much-needed
investments that will enhance the tremendous intellectual capital and
innovative spirit of New York State.

Together, these provisions would help ensure that New York State
remains "Open for Business," by creating a climate within which
innovation, creativity and growth can flourish.
The bill would provide a system within which public-private
partnerships could be fostered in a manner that capitalizes on the
business and university infrastructure that anchors economic
development in New York. This strategy will encourage economic growth
in New York State.

PRIOR LEGISLATIVE HISTORY:

This is a new bill.

FISCAL IMPLICATIONS:

There are no fiscal implications from this bill.

EFFECTIVE DATE:

This bill takes effect immediately.

2011-S5782 (ACTIVE) - Bill Text download pdf

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  5782

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                              June 16, 2011
                               ___________

Introduced  by Sen. ALESI -- (at request of the Empire State Development
  Corporation) -- read twice and ordered printed, and when printed to be
  committed to the Committee on Finance

AN ACT to amend the New York state urban development corporation act, in
  relation to the capital access program and to provide for a new  Inno-
  vate NY fund; and making appropriations for the support of government

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1.  Section 16-k of section 1 of chapter 174 of  the  laws  of
1968, constituting the New York state urban development corporation act,
as  added  by section 1 of part J of chapter 413 of the laws of 1999, is
amended to read as follows:
  S 16-k. Capital access program. 1. Definitions.  For the  purposes  of
this section:
  (a)  "Financial  institution",  means any bank, trust company, savings
bank, savings and loan association or cooperative bank chartered by  the
state  or  any  national  banking  association, federal savings and loan
association or federal savings bank OR ANY COMMUNITY DEVELOPMENT  FINAN-
CIAL  INSTITUTION  OR  COMMUNITY-BASED  LENDING  ORGANIZATION; provided,
however, that the financial institution has its principal office located
in the state.
  (b) "Participating financial institution"  shall  mean  any  financial
institution participating in the program established by this section.
  (c)  "Small  business"  shall  have  the  same meaning as set forth in
section 131 of the economic development  law,  whose  primary  place  of
business is in New York state.
  2. (a) The corporation, or its agent, shall establish a capital access
program  to  provide a loan loss reserve to assist small businesses that
otherwise find it difficult to obtain regular bank financing.
  (b)(i) Assistance [from this] UNDER THE CAPITAL ACCESS  program  shall
be  provided for a capital access program under which the corporation or

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD13170-01-1

S. 5782                             2

its agent shall be authorized to assist small businesses that  otherwise
find  it  difficult to obtain regular OR SUFFICIENT bank financing. Such
assistance shall take the form of deposits by  the  corporation  or  its
agent  in  the  reserve funds in participating financial institutions to
fund loan loss reserves for loans made to such small businesses.
  (ii) Any financial institution  desiring  to  become  a  participating
financial  institution  shall  execute  an agreement in such form as the
corporation or its agent may prescribe, which  agreement  shall  contain
the  terms and provisions set forth in paragraph (c) of this subdivision
and such other terms and provisions as the corporation or its agent  may
deem necessary or appropriate.
  (c)  A  participating  financial  institution  originating a loan to a
small business pursuant to this section shall:
  (i) provide a plan to the corporation or its agent for  the  marketing
of  the  capital  access program TO SMALL BUSINESSES, INCLUDING THOSE in
highly distressed areas and to  minority-  and  women-owned  businesses,
with appropriate lending objectives identified by the financial institu-
tion for such areas and businesses;
  (ii) disperse funds for the purposes of expansion, facility/technology
upgrading, start-up and working capital;
  (iii)  not  disperse  funds  which  exceed an amount greater than five
hundred thousand dollars;
  (iv) set aside an amount, specified OR AGREED TO by the corporation or
its agent, [but which shall not be] FROM BOTH THE  PARTICIPATING  FINAN-
CIAL  ORGANIZATION  AND  THE SMALL BUSINESS, NOT less than [one and one-
half] THREE percent nor more than [three and one-half] SEVEN percent  of
the  principal amount of the loan, WHEREBY THE AMOUNT CONTRIBUTED BY THE
SMALL BUSINESS DOES  NOT  EXCEED  FIFTY  PERCENT  OF  THE  TOTAL  AMOUNT
CONTRIBUTED  BY THE SMALL BUSINESS AND THE FINANCIAL INSTITUTION, into a
loan loss reserve which the institution shall  maintain,  applicable  to
all  such loans by said institution to small businesses pursuant to this
section; AND
  (v) [obtain from the small business an amount  equal  to  the  reserve
contribution  made  by  the  participating  financial  institution  with
respect to such loan;
  (vi) set aside such amount into said loan loss reserve  maintained  by
the participating financial institution applicable to all loans pursuant
to this section; and
  (vii)]  certify  to the corporation or its agent in such a fashion and
with such supporting information as the corporation or its  agent  shall
prescribe, that it has made such loan and has set aside its contribution
and the [equal] contribution of the small business.
  (d)  The  corporation  or  its agent shall after such certification as
provided in subparagraph [(vii)] (V) of paragraph (c) of  this  subdivi-
sion,  transfer  to  the  participating  financial institution an amount
equal to the total of the contributions of the  participating  financial
institution  and  the small business or such additional amount up to one
hundred fifty percent of such contributions as determined by the  corpo-
ration  or  its agent. The participating financial institution shall set
aside such amount so received into said loan loss reserve.
  (e) In the event the participating  financial  institution  suffers  a
loss  on  any such loan, it may in its discretion draw upon the funds in
such loan loss reserve to repay the loan in whole or in part.
  (f) All amounts set aside by the participating  financial  institution
into said loan loss reserve shall be in an account at said institution.

S. 5782                             3

  (g)  Earnings or interest from the principal of said loan loss reserve
accounts shall be:
  (i)  maintained  in  the  account  and  held  as  additional loan loss
reserves; and
  (ii) available to the corporation or its agent at any  time  and  from
time  to  time,  to  be  used  to  defray the costs of administering the
program or to replenish the loan loss reserve account of the corporation
or its agent.
  (H) THE CORPORATION SHALL ASSURE ADEQUATE GEOGRAPHIC  DISTRIBUTION  OF
PARTICIPATING  FINANCIAL INSTITUTIONS THROUGHOUT THE STATE TO THE EXTENT
FEASIBLE.
  3. Administration of the capital access program. (a)  The  corporation
is hereby authorized to do the following:
  (i)  enter  into  a contract with A THIRD PARTY FINANCIAL INSTITUTION,
WHICH MAY BE the New York business development corporation, [hereinafter
referred to as NYBDC,] established under section 210 of the banking law,
to act as the agent of the corporation  with  respect  to  the  adminis-
tration  of  the  program,  PROVIDED THAT THE SELECTION OF A THIRD PARTY
OTHER THAN THE NEW YORK BUSINESS DEVELOPMENT CORPORATION SHALL  BE  MADE
PURSUANT TO A COMPETITIVE PROCESS;
  (ii) conduct an annual review and assessment of the performance of the
[NYBDC]  THIRD  PARTY  in  its  capacity as agent for the corporation to
determine whether the contract referenced in subparagraph  (i)  of  this
paragraph  should  be  renewed  for  an  additional two year period. The
review shall be based on whether  the  [NYBDC]  THIRD  PARTY  AGENT  has
satisfactorily met the terms and conditions of the contract;
  (iii)  where  an  initial determination finds that the [NYBDC's] THIRD
PARTY AGENT'S performance is unsatisfactory,  allow  the  [NYBDC]  THIRD
PARTY AGENT the opportunity to take corrective action;
  (iv)  where  a  final  review  of  the  [NYBDC's]  THIRD PARTY AGENT'S
performance continues to conclude that the [NYBDC's] THIRD PARTY AGENT'S
performance is unsatisfactory, submit to the speaker of the assembly and
the temporary president of the senate its  recommendation  to  terminate
the  contract  with  the  [NYBDC]  THIRD  PARTY  AGENT  and transfer the
contract to another agent; and
  (v) promulgate rules and regulations with respect to  the  implementa-
tion  of  the capital access program established by this section and any
other rules and regulations necessary to fulfill the  purposes  of  this
section,  in accordance with the state administrative procedure act, and
WHICH shall be consistent with the program plan required by  subdivision
19 of section 100 of the economic development law.
  (b)  Any  contract  entered into pursuant to subparagraph (i) of para-
graph (a) of this subdivision shall:
  (i) be for a period of two years and shall be  renewed  for  an  addi-
tional  two  year period subject to requirements of subparagraph (ii) of
paragraph (a) of this subdivision; and
  (ii) provide for compensation for expenses  incurred  by  the  [NYBDC]
THIRD  PARTY AGENT in connection with its services as agent and for such
other services as the corporation may deem  appropriate  including,  but
not  limited to the use of the premises, personnel and personal property
of the [NYBDC] THIRD PARTY AGENT.
  S 2. Section 1 of chapter 174 of the laws of  1968,  constituting  the
New York state urban development corporation act, is amended by adding a
new section 16-u to read as follows:
  S  16-U.  INNOVATE NY FUND. 1. THE INNOVATE NY FUND IS HEREBY CREATED.
THE PURPOSE OF THE INNOVATE NY FUND IS TO MAKE AVAILABLE STATE FUNDS  TO

S. 5782                             4

ELIGIBLE APPLICANTS TO SUPPORT EMERGING BUSINESS IDEAS AND PRODUCTS THAT
RESULT  IN  THE  GROWTH OF BUSINESS WITHIN THE STATE AND THE CONCOMITANT
CREATION OF JOBS AND TAX REVENUES FOR THE STATE.
  2.  ELIGIBLE APPLICANTS FOR INNOVATE NY FUNDS MAY INCLUDE REGIONAL AND
LOCAL ECONOMIC DEVELOPMENT ORGANIZATIONS, TECHNOLOGY DEVELOPMENT  ORGAN-
IZATIONS,  RESEARCH  UNIVERSITIES,  AND  INVESTMENT  FUNDS  THAT PROVIDE
SEED-STAGE INVESTMENTS IN NEW YORK STATE COMPANIES.
  3. FUNDING FROM THE INNOVATE NY FUND MAY  BE  MADE  AVAILABLE  TO  THE
APPLICANT FOR INVESTMENT IN BENEFICIARY COMPANIES. IN ORDER TO BE ELIGI-
BLE  FOR  AN  INVESTMENT  THAT  INCLUDES INNOVATE NY INVESTMENT FUNDS, A
BENEFICIARY COMPANY MUST: (A) BE, OR AGREE IN WRITING TO BE, LOCATED  IN
NEW  YORK  STATE; (B) BE IN THE SEED-STAGE OF DEVELOPMENT, AS DEFINED BY
THE CORPORATION; (C) DEMONSTRATE A POTENTIAL FOR SUBSTANTIAL GROWTH  AND
JOB  DEVELOPMENT  IN AN EMERGING TECHNOLOGY FIELD, AS DEFINED IN SECTION
THIRTY-ONE HUNDRED TWO-E OF THE PUBLIC AUTHORITIES LAW OR IN REGULATIONS
AS ADOPTED BY THE CORPORATION; AND (D) HAVE THE  POTENTIAL  TO  GENERATE
ADDITIONAL  ECONOMIC  ACTIVITY  IN NEW YORK STATE.   INVESTMENT PRIORITY
SHALL BE GIVEN TO BENEFICIARY COMPANIES INVOLVED IN COMMERCIALIZATION OF
RESEARCH AND DEVELOPMENT OR HIGH TECHNOLOGY MANUFACTURING.
  4. THE CORPORATION SHALL ESTABLISH A COMPETITIVE PROCESS FOR THE EVAL-
UATION OF APPLICANTS FOR THE INNOVATE NY INVESTMENT  FUND.    APPLICANTS
SHALL BE EVALUATED ON CRITERIA INCLUDING, BUT NOT LIMITED TO, THE APPLI-
CANT'S:    (A)  TRACK  RECORD OF SUCCESS IN RAISING INVESTMENT FUNDS AND
SUCCESSFULLY INVESTING THEM; (B) CAPACITY TO PERFORM DUE  DILIGENCE  AND
TO  PROVIDE MANAGEMENT EXPERTISE AND OTHER VALUE-ADDED SERVICES TO BENE-
FICIARY COMPANIES; (C) FINANCIAL RESOURCES FOR IDENTIFYING AND INVESTING
IN SEED-STAGE  COMPANIES;  (D)  ABILITY  TO  SECURE  NON-STATE  MATCHING
PROGRAM INVESTMENT FUNDS AT A RATIO THAT IS EQUAL TO OR GREATER THAN ONE
TO ONE (1:1); (E) ABILITY TO EVALUATE THE COMMERCIAL POTENTIAL OF EMERG-
ING  TECHNOLOGIES;  (F)  ABILITY  TO  SECURE  PARTNERSHIPS WITH LOCAL OR
REGIONAL INVESTORS; (G) ADOPTION  OF  CONFLICT  OF  INTEREST  PROVISIONS
ACCEPTABLE  TO  THE  CORPORATION; AND (H) OTHER CRITERIA THAT THE CORPO-
RATION DETERMINES IS RELEVANT TO MAKING INVESTMENT DECISIONS  CONSISTENT
WITH  THE  PURPOSES  OF THE FUND AS SET FORTH IN SUBDIVISION ONE OF THIS
SECTION.  WHEN AWARDING FUNDS PURSUANT TO THIS SUBDIVISION,  THE  CORPO-
RATION  SHALL  ASSURE  THAT THE APPLICANTS DEMONSTRATE THE NEED FOR SEED
CAPITAL IN THE AREAS SERVED BY THE APPLICANT AND  PROVIDE  FOR  ADEQUATE
GEOGRAPHIC  DISTRIBUTION  OF  AWARDS TO BENEFICIARY COMPANIES THROUGHOUT
THE STATE TO THE EXTENT FEASIBLE.    THE  CORPORATION  SHALL  DISTRIBUTE
FUNDS  PROMPTLY PURSUANT TO A DISBURSEMENT PROCESS AGREED TO BETWEEN THE
CORPORATION AND APPLICANT TO ENABLE THE APPLICANT TO FULFILL COMMITMENTS
TO BENEFICIARY COMPANIES IN A TIMELY MANNER.
  5. AT THE TIME THE APPLICANT HAS INVESTED FIFTY PERCENT OF  THE  INNO-
VATE  NY  FUNDS  COMMITTED  TO  SUCH  APPLICANT AND ANNUALLY THEREAFTER,
AGGREGATE INVESTMENTS OF INNOVATE NY FUNDS BY SUCH APPLICANT IN  BENEFI-
CIARY  COMPANIES  SHALL  BE  LEVERAGED  WITH  PRIVATE SOURCES OF CAPITAL
EXCLUDING INVESTMENTS AFTER THE INITIAL FUNDING ROUND AT A  RATIO  EQUAL
TO OR GREATER THAN TWO TO ONE (2:1).
  6. THE INNOVATE NY FUND SHALL NOT INVEST AN AMOUNT IN ANY SINGLE BENE-
FICIARY  COMPANY  THAT  EXCEEDS  FIVE HUNDRED THOUSAND DOLLARS, OR SEVEN
HUNDRED FIFTY THOUSAND DOLLARS IN THE CASE OF ANY INDIVIDUAL BIOTECHNOL-
OGY-RELATED BENEFICIARY, AT ANY ONE TIME, SUBJECT TO CERTAIN  EXCEPTIONS
TO BE ESTABLISHED BY RULES AND REGULATIONS OF THE CORPORATION.
  7.  NOTWITHSTANDING  ANY  PROVISION OF LAW TO THE CONTRARY, THE CORPO-
RATION MAY ESTABLISH A PROGRAM FUND FOR PROGRAM USE AND  PAY  INTO  SUCH

S. 5782                             5

FUND  ANY  ELIGIBLE  FUNDS AVAILABLE TO THE CORPORATION FROM ANY SOURCE,
INCLUDING MONEYS APPROPRIATED BY THE STATE.
  8.  THE CORPORATION SHALL SUBMIT A REPORT ANNUALLY ON DECEMBER THIRTY-
FIRST TO THE DIRECTOR OF THE BUDGET,  THE  TEMPORARY  PRESIDENT  OF  THE
SENATE,  THE  SPEAKER OF THE ASSEMBLY, THE MINORITY LEADER OF THE SENATE
AND THE MINORITY LEADER OF THE ASSEMBLY DETAILING (A) THE  TOTAL  AMOUNT
OF  FUNDS COMMITTED TO EACH APPLICANT THAT RECEIVES FUNDS AND THE AMOUNT
OF SUCH FUNDS THAT HAS BEEN INVESTED BY EACH  SUCH  APPLICANT;  (B)  THE
AMOUNT  OF  INNOVATE  NY  AND PRIVATE FUNDS INVESTED IN EACH BENEFICIARY
COMPANY; (C) THE TYPE  OF  PRODUCT  OR  TECHNOLOGY  BEING  DEVELOPED  OR
PRODUCED BY EACH BENEFICIARY COMPANY; (D) THE LOCATION OF EACH BENEFICI-
ARY COMPANY; (E) THE NUMBER OF JOBS PROJECTED TO BE CREATED OR RETAINED;
AND (F) SUCH OTHER INFORMATION AS THE CORPORATION DEEMS NECESSARY.
  9.  THE CORPORATION IS HEREBY AUTHORIZED TO PROMULGATE RULES AND REGU-
LATIONS IN ACCORDANCE WITH THE STATE ADMINISTRATIVE PROCEDURE ACT AS ARE
NECESSARY TO FULFILL  THE  PURPOSES  OF  THIS  SECTION,  INCLUDING  WITH
RESPECT  TO  REASONABLE  MANAGEMENT  FEES, PROMOTES, SHARE OF RETURN AND
OTHER FEES AND CHARGES OF APPLICANTS THAT RECEIVE FUNDS, AND TO  PROVIDE
FOR  THE  REPAYMENT  OF FUNDS RECEIVED BY THE BENEFICIARY COMPANY IF THE
BENEFICIARY COMPANY LEAVES NEW YORK STATE WITHIN A PERIOD OF TIME TO  BE
ESTABLISHED BY THE CORPORATION.
  10.  IN ACCORDANCE WITH THE RULES AND REGULATIONS TO BE PROMULGATED BY
THE CORPORATION, THE CORPORATION MAY IMPOSE  FEES,  ESTABLISH  REPAYMENT
TERMS  AND  PROVIDE  FOR  EQUITY  PARTICIPATION  BY  THE  CORPORATION IN
CONNECTION WITH INVESTMENTS FROM THE INNOVATE NY FUND.
  11. THE PROVISIONS OF SECTION  TEN  AND  SUBDIVISION  TWO  OF  SECTION
SIXTEEN  OF  THIS  ACT SHALL NOT APPLY TO ASSISTANCE PROVIDED UNDER THIS
SECTION.
  S 3. a) The several amounts specified in this act for aid  to  locali-
ties,  or  so  much  thereof  as  shall  be sufficient to accomplish the
purposes designated by the appropriations, are hereby  appropriated  and
authorized  to be paid as hereinafter provided, to the respective public
officers and for the several purposes specified.
  b) Where applicable, appropriations made by this act for  expenditures
from  federal grants for aid to localities may be allocated for spending
from federal grants for any grant period beginning, during, or prior to,
the state fiscal year beginning on April 1,  2011  except  as  otherwise
provided.
  c)  No  moneys appropriated by this act shall be available for payment
until a certificate of approval has been issued by the director  of  the
budget, who shall file such certificate with the department of audit and
control,  the chairperson of the senate finance committee and the chair-
person of the assembly ways and means committee.
  d) The appropriation contained within this section  is  based  on  the
amount  of federal moneys estimated to become available within the funds
for which this appropriation provides. Disbursements from this appropri-
ation shall be limited to the actual amounts received in such funds from
the federal government.
  e) The appropriations contained in this act shall be available for the
fiscal year beginning on April 1, 2011 except as otherwise provided.

                   DEPARTMENT OF ECONOMIC DEVELOPMENT

SMALL BUSINESS CREDIT INITIATIVE PROGRAM .................... 55,351,534

S. 5782                             6

  Special Revenue Funds - Federal
  Federal Operating Grant Fund
  Small Business Credit Initiative Account

For   programs   and  activities  authorized
  pursuant to section sixteen-f of  the  new
  york  state  urban development corporation
  act,  including  any  services  and  costs
  associated  with  administration  of  such
  programs and activities,  subject  to  the
  limitations  imposed  by  federal  funding
  requirements.     Notwithstanding      any
  provision  of  law  to  the contrary, such
  moneys shall be paid by the department  of
  economic development to the new york state
  urban development corporation from federal
  operating  grant  moneys  deposited in the
  state treasury for the federal state small
  business  credit  initiative.     Provided
  further  that,  notwithstanding any incon-
  sistent provision of law, subject  to  the
  approval  of  the  director of the budget,
  funds appropriated herein  may  be  inter-
  changed  with  any other item of appropri-
  ation to be funded from the small business
  credit initiative account ................... 10,405,173
For  programs  and   activities   authorized
  pursuant  to  section sixteen-k of the new
  york state urban  development  corporation
  act,  including  any  services  and  costs
  associated  with  administration  of  such
  programs  and  activities,  subject to the
  limitations  imposed  by  federal  funding
  requirements.        Notwithstanding   any
  provision of law  to  the  contrary,  such
  moneys  shall be paid by the department of
  economic development to the new york state
  urban development corporation from federal
  operating grant moneys  deposited  in  the
  state treasury for the federal state small
  business   credit  initiative.    Provided
  further that, notwithstanding  any  incon-
  sistent  provision  of law, subject to the
  approval of the director  of  the  budget,
  funds  appropriated  herein  may be inter-
  changed with any other item  of  appropri-
  ation to be funded from the small business
  credit initiative account ................... 18,994,204
For   programs   and  activities  authorized
  pursuant to section sixteen-u of  the  new
  york  state  urban development corporation
  act,  including  any  services  and  costs
  associated  with  administration  of  such
  programs and activities,  subject  to  the
  limitations  imposed  by  federal  funding

S. 5782                             7

  requirements.       Notwithstanding    any
  provision  of  law  to  the contrary, such
  moneys shall be paid by the department  of
  economic development to the new york state
  urban development corporation from federal
  operating  grant  moneys  deposited in the
  state treasury for the federal state small
  business  credit  initiative.     Provided
  further  that,  notwithstanding any incon-
  sistent provision of law, subject  to  the
  approval  of  the  director of the budget,
  funds appropriated herein  may  be  inter-
  changed  with  any other item of appropri-
  ation to be funded from the small business
  credit initiative account ................... 25,952,157

  S 4. This act shall take effect immediately.

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